ARGUMENTS AS TO THE TRUE VALUE OF 
 THE GENERAL PROPERTY IN WISCONSIN 
 
 January, 1904 
 
 , v.' '' v , -,4f 
 
 ; V ‘ , v ^ . *** 
 
 FRANK P. CRANDON 
 THOMAS H. BROWN 
 ARTHUR S. DUDLEY 
 W. W. BALWIN 
 THOMAS A. POLLEYS 
 
Return this book on or before the 
 Latest Date stamped below. 
 
 Theft, mutilation, and underlining of books 
 are reasons for disciplinary action and may 
 result in dismissal from the University. 
 University of Illinois Library 
 
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 University 
 
 Madison, Wisconsin, January 26, 1904. 
 
 HEARING OF THE REPRESENTATIVES OF THE VARIOUS RAIL- 
 ROAD COMPANIES BEFORE THE STATE BOARD OF ASSESS- 
 MENT, IN THE MATTER OF THE TRUE VALUE OF THE GEN- 
 ERAL PROPERTY OF THE STATE. 
 
 Present : 
 
 N. S. Gilson, George Curtis, Jr., and Nils P. Haugen, 
 members of the Board; Prof. Wm. D. Taylor, Engineer of 
 the Board; John Marsden, Jr., Engineer and Inspector of 
 the Board. 
 
 Erank P. Crandon, Tax Commissioner Chicago & North- 
 western By. 
 
 A. S. Dudley, Tax Commissioner Chicago, Milwaukee & 
 St. Paul By. 
 
 Thomas H. Gill, Tax Commissioner Wisconsin Central 
 Bailway. 
 
 E. P. Hickey, Tax Commissioner Northern Pacific By. 
 
 Charles Hayden, Tax Commissioner Eastern By. of Min- 
 A nesota. 
 
 George G. Tunell, Secretary to the President Chicago & 
 Northwestern By. 
 
 George B. Peck, General Counsel Chicago, Milwaukee & 
 St. Paul By. 
 
 T. A. Polleys, Tax Commissioner Chicago, St. Paul, Min- 
 neapolis & Omaha By. 
 
 Chairman Gilson : Gentlemen, we have met to-day for 
 
 the purpose of giving the representatives of the railroad 
 companies in this state who are to be assessed under the 
 
 I 09277 
 
2 
 
 ad valorem law the opportunity to be heard and to present 
 their views in regard to the value of the general property 
 of the state, which is to be one element in arriving at the 
 average rate of taxation. Are you ready to proceed, gentle- 
 men, with your discussion of these questions ? 
 
 Mr. Frank P. Crandon: Since the meeting that was held 
 
 here with the Commission in September, the committee that 
 was then appointed by the various railroad companies to 
 take up this question and examine it has been very diligently 
 at work. We have made very extensive investigations, and 
 have ready for your consideration a very large amount of 
 statistical information which we think will be of great in- 
 terest. Our work has been carried on jointly ; the three mem- 
 bers of the committee being Mr. Baldwin, Mr. Dudley and 
 myself. We greatly appreciate the courtesy of the Commis- 
 sion in coming together to-day to hear the result of our 
 labors. Since I started from home I have learned that Mr. 
 Baldwin, who has to do very largely with an important part 
 of our investigation, starting from Burlington, has been de- 
 layed four hours ; and since I got here I have had a 
 telephonic conversation with him. He asks if it be possible, 
 if we are not trenching too far upon the courtesy of the Tax 
 Commission that an adjournment may be taken until he ar- 
 rives. He suggested such adjournment till 8 o’clock to-night, 
 as he expected to take a train that is due here then. In the 
 little conversation I have had with some of the gentlemen 
 present it was a question whether we ought not to adjourn, 
 if the Commission is so disposed, until to-morrow morning, 
 rather than to 8 o’clock to-night. If Mr. Blaldwin comes, 
 as he will if the train gets here, our committee is ready to 
 proceed at any time. If the Commission can grant us the 
 favor asked for, we shall be greatly obliged. 
 
3 
 
 Mr. Georg© R. Peck : Mr. Chairman. — The request of Mr. 
 Baldwin, it seems to me, is a very reasonable one. Probably 
 he feels worse about it than any of the rest of us, because in 
 addition to missing the appointment he is probably plugging 
 along on some slow train towards Madison. I doubt very much 
 if you can count on the train which is due here at 8 o’clock 
 being here at that time. Hardly any train is now moving on 
 time. I was nearly two hours late this morning. But how 
 would this plan do, if the Commission grant a postponement, 
 to fix 8 o’clock to-night. Is the train due promptly at 8 ? 
 
 Mr. Thomas H. Gill: Eight, at the west depot. 
 
 Mr. Peck: Then it would be half past before you could 
 
 get. started anyway, that is, before we could get him up from 
 the train. I would like very much myself to have something 
 done to-night, so as to be more certain to finish to-morrow. 
 I hoped that we could do some of the work to-night, if the 
 Commission would consent to hold an evening session. 
 
 Chairman Gilson : Well, gentlemen, I think that it would 
 be better to adjourn until to-morrow morning, rather than to 
 attempt to hold a session this evening. The discussion of the 
 questions that are involved in this inquiry are too important 
 to be taken up in an evening session. Mr. Baldwin probably 
 couldn’t get here before 9 o’clock, and that hour would be 
 very inconvenient, I think, for everybody. If it is agree- 
 able to all the gentlemen who appear here acting with you, 
 we will adjourn until 9 o’clock, or 10 o’clock to-morrow, as 
 most convenient, 
 
 Mr. Peck: I would suggest 9 o’clock, Mr. Chairman, be- 
 
 cause time is important now. 
 
 Chairman Gilson: We will then adjourn the hearing un- 
 til 9 o’clock to-morrow morning;. 
 
 # O 
 
4 
 
 Madison January 27, 1904. 
 
 Hearing Resumed. 
 
 Parties present as before noted, and in addition, Mr. 
 L. W. Bowers, General Counsel of the C. & 1ST. W. Ry. Co., 
 and Mr. W. W. Baldwin, Tax Commissioner of the C., B. & 
 Q. Ry. Co. 
 
 Chairman Gilson: Gentlemen, if you are ready to pro- 
 
 ceed this morning, we shall be pleased to hear what you 
 have to offer. 
 
 STATEMENT OF FRANK P. CRANDON ON THE VALUE OF THE 
 
 GENERAL PROPERTY IN WISCONSIN SUBJECT TO TAXA- 
 TION. 
 
 Mr. Frank P. Crandon: Mr. Chaiman, as we are all 
 
 aware the law enacted by the last legislature of Wisconsin 
 provides that the rate of taxation which shall be applied to 
 the assessed value of the Wisconsin railroads, is to be de- 
 termined by ascertaining the average rate of taxation which 
 is borne by what the law designates “The general property 
 of the state/' 
 
 When we take note of the stringent provisions of the stat- 
 ute for ascertaining to the last possible fraction of a dollar, 
 the value of the railroad property, it is seen to be fundament- 
 ally important that the value of the said general property, 
 which is the basis to be used for establishing the taxing rate, 
 should be fully and equitably ascertained. 
 
 The representatives of the Wisconsin railways realizing 
 the importance of this proposition, last September appointed 
 a committee to take up that matter and to find out if they 
 could, what is the value of the general property. That com- 
 mittee consisted of Mr. W. W. Baldwin of the C., B. & Q. 
 
5 
 
 Ry. Co., Mr. A. S. Dudley of the C., M. & St. P. Ry. Co., 
 and myself. Before entering upon our work we had a pleas- 
 ant conference with yourselves as to the best methods of car- 
 rying on our inquiries, and w T e desire at this time to express 
 our appreciation of the courtesy, kindness and helpfulness, 
 of which we were then the recipients. 
 
 We have given much time and labor and thought to this 
 subject. Our investigations have been carried on at a con- 
 siderable expense, and w© now return to you to make what, 
 may be regarded as, in some sort, a report of our acts and do- 
 ings and conclusions. 
 
 The task to which we were assigned is both more difficult 
 and more comprehensive than we at first realized. Though 
 we have been diligent and have used to the best advantage 
 the time at our command, the work is still incomplete and 
 after we have told you about it, the question will arise 
 whether we will discontinue our investigations or prosecute 
 them further. This question of course the several companies 
 which are interested in the results and the preferences of 
 your Commission, will decide. 
 
 In order that we might not consume your time by unneces- 
 sary repetitions and also that our report might assume a 
 more systematic form than could otherwise be given to 
 it, we have divided the work of its presentation as follows : 
 
 First. To myself was assigned the discussion of the gen- 
 eral propositions which we have considered and the methods 
 which were adopted in the prosecution of our inquiries. 
 
 Second. Mr. Dudley will present the statistical facts 
 which we have gathered and formulated, and with which he 
 is exceedingly familiar. 
 
 Third. Mr. Baldwin will take up and discuss the ques- 
 tions connected with the value and assessment of Wisconsin 
 personal property — which is a prolific and interesting field. 
 
6 
 
 I make this statement now so that you may kno^ what 
 are the limitations which we have severally placed upon 
 ourselves, and also that you may know what to expect as 
 the discussion proceeds. 
 
 When we met in September our work had not been begun. 
 The problem which we were to try to solve was a difficult 
 one. Accessible data were scanty, incomplete and unrelia- 
 ble. The returns of the local assessors throughout the state, 
 are made up on such different theories, that even in their 
 best estate, they afford no accurate information, and are 
 never more than a suggestion as to real value even in the 
 ease of real property, and are absolutely valueless as a basis 
 for determining either the amount or the worth of the per- 
 sonal property of the state. We were soon convinced that 
 if our work was to be helpful to the Board of Assessment, 
 or if it should afford any substantial support for such con- 
 clusions as might eventually be reached by ourselves, it must 
 partake largely of the character of an original investigation. 
 
 At that time w T e considered very fully, and were very 
 greatly impressed by the method that is so elaborately set 
 forth in the report of the Tax Commission for 1901, for as- 
 certaining the value of Wisconsin realty. Without taking 
 time now to re-state that method in detail, it may be suf- 
 ficient for the information of those who are unfamiliar with 
 it to say, that it is based upon the reported sales of real prop- 
 erty that have been made throughout the state, comparing 
 the consideration that is named in those conveyances with the 
 actual assessment placed upon the property at the assessment 
 period nearest to the date of making the sale, and after as- 
 certaining the ratio which exists between the selling value 
 and the assessment value of the property described, to apply 
 the ratio thus obtained to the assessed value in an assess- 
 ment district, and thus obtain what is assumed to be the 
 
7 
 
 real value of the property in that particular district, and so 
 on throughout the state. 
 
 At the September meeting, Mr. T. A. Polleys of the Chi- 
 cago, St, Paul, Minneapolis and Omaha Kailway Company, 
 was present. He had on his own account, made some investi- 
 gations as to the results which would follow this method 
 when applied to localities with which he was familiar. His 
 inquiries had not extended beyond those* counties which are 
 traversed at least in part by the C., St, P. M. & O. railroad 
 and were limited to the transactions of a single year. The 
 results which he obtained were so different* from those ob- 
 tained by the Tax Commission that* he was of the opinion 
 that some very serious errors had crept into’ the* Commis- 
 sion’s computations. 
 
 The Tax Commission was not less anxious than we were 
 ourselves that the accuracy of these computations should be 
 tested, and that if they were in any respect erroneous, the 
 proper correction should be made. With the full concur- 
 rence of the Commission and of our Committee, Mr. Pol- 
 leys agreed to undertake an examination to determine the 
 accuracy of the computations referred to and to test their 
 value. He did that. He spent a large amount of time and 
 a great deal of work in revising those computations and 
 the result was, that when his examinations covered the same 
 periods which had been used by the Tax Commission, and 
 the* method was applied according to the Commission’s plan, 
 the results were substantially identical. Mr. Polleys’ im- 
 pressions as to the inaccuracy of these computations had 
 arisen from the fact that he had confined his original in- 
 vestigations to the operations of a single year, while the 
 results set forth by the Commission had covered a period 
 of five years. The results obtained when the data for a 
 
8 
 
 single year were taken, were so at variance with what they 
 were when taken for a period of five years, that he could only 
 account for that difference on the theory that serious errors 
 had crept into the computations. I think he was subse- 
 quently convinced that that was not true. The fact, how- 
 ever, existed at the end of his investigation as he had found 
 it in the first instance, that when the investigation was con- 
 fined to the period of a single year, a very different result 
 would be produced from that which appeared as the conclu- 
 sions of the Tax Commission in the report referred to. 
 
 But when it was applied to the period of five years the 
 report was substantially correct. That is right, isn’t it, Mr. 
 Polleys ? 
 
 Mr. Polleys: Yes; substantially the same, for the same 
 
 period, by the same method. 
 
 Mr. Crandon: Our Committee was at first considerably 
 
 impressed by the reasoning contained in the report of the 
 Tax Commission, and thought that perhaps the method they 
 had adopted would provide for a very considerable part of 
 the work which we had been expected to do, and we were not 
 at the time of the September conference prepared to suggest 
 any different or better method for ascertaining the actual 
 value of the real estate in Wisconsin, outside of that which 
 is devoted to railroad purposes. 
 
 Since that time, however, we have given the whole sub- 
 ject the most careful consideration and have made a most 
 comprehensive examination into all the details connected 
 with the reported real estate sales in several counties of the 
 state and we are convinced that the method suggested by 
 the Tax Commission is absolutely unreliable. Theoretically 
 it is plausible and fair. If the reported conveyances ade- 
 quately set forth all of the features of the transactions to 
 
9 
 
 which they refer — if it were possible to know that only the 
 reports of bona fide transactions entered into the computa- 
 tion, and if we could be sure that the property which had 
 been sold and the property which had been assessed, were in 
 all cases identical, the theory in question might afford some 
 substantial basis for an estimate of real values. But as a 
 matter of fact in a majority of instances, these conditions do 
 not exist. In more than half of the conveyances reported, 
 one or more and in some cases all of these essential consider- 
 ations are wanting. In many of the instances none of the 
 data is accurately stated. As we proceeded with our work, 
 the unreliability of the reported conveyances, as an indica- 
 tion of actual value became more and more manifest, until 
 finally our committee was convinced of the entire untrust- 
 worthiness of any conclusions which are based on the theory 
 that I have just been considering. 
 
 The statistics supporting this conclusion will be presented 
 by Mr. Dudley, and it may be sufficient to say now that the 
 use of the reported conveyances was necessarily discarded. 
 
 I suppose that the plan of extending this examination 
 as to real estate values over a period of five years, largely 
 resulted from the sincere purpose of the Tax Commission 
 to be exactly fair and to do justice to all the interests which 
 would be affected by whatever conclusions as to values, they 
 should eventually reach. 
 
 I do not know what their views now may be 1 , but in their 
 last two reports they dealt largely with the theory of deter- 
 mining the value of railroads by what is known as the “Stock 
 and Bond method,” and in order that they might obtain 
 reasonably correct and satisfactory quotations of the value 
 of those securities, they extended their examinations as to 
 the sales of railroad stocks and bonds through a period of 
 
10 
 
 five and of seven years, and from the different values 
 which had prevailed at different dates throughout such pe- 
 riods they found an average price at which they thought it 
 was fair to estimate the value of said securities. Then wbh 
 the purpose to be just as fair as possible, they seem to have 
 said : “Now, let us extend our examination as to the value 
 
 of ieal estate so as to cover the same period. This plan will 
 put all properties on an equal basis and no one will he harmed 
 or can complain.” 
 
 Just here we think they were in error. 
 
 The Tax Commisison already knows that the railway com- 
 panies that are represented by this Committee do not believe 
 or admit that the selling price of the stocks and bonds of any 
 such company, even remotely suggests the value of the prop- 
 erty owned by the company which issues the securities. It 
 seems, however, that if the stock and bond method is to be 
 observed, it will be fair to find an average selling price for 
 those securities throughout a period which is long enough to 
 correct quotations which are due to temporary causes and ab- 
 normal fluctuations. If the prices of stocks and bonds only 
 advanced and receded when corresponding changes occurred 
 in the value of the property which it is claimed they reprer 
 sent (and this would be the case if the stock and bond the^ 
 ory had any value) then there would not only be no neces- 
 sity for obtaining such an average value, but it would be an 
 error to use it when it was obtained, because it would be 
 possible to determine the actual value of the property from 
 the market quotations of its securities at the date fixed for 
 the assessment, and that is exactly what we want to know. 
 Or, to state my proposition in just a little different form, 
 let me say — the averaging process above referred to could 
 not have been adopted for the purpose of finding the aver- 
 
11 
 
 age value of the railroad property through a period of three, 
 five or seven years, in order that the present assessment may 
 be fixed at that sum. Such an assessment would be an il- 
 legality, and could on proper proof that the assessor or as- 
 sessors had based their conclusions on that theory, be set 
 aside. The only tenable purposes for which said averages 
 may be used, is that they will aid the assessors in determining 
 what is the present fair value of the property, and so far as 
 they serve to throw light on that proposition, their use is 
 appropriate and valuable. 
 
 But the situation with regard to real estate is altogether 
 different. Let us see. 
 
 The fact that real estate has been steadily advancing in 
 value during the last eight or ten years is universally recog- 
 nized and is undisputed. It was never before so valuable 
 as it is to-day. Any averaging which could be attempted 
 must be made with prices and values which are all lower 
 than those which now prevail, and must of necessity fix the 
 value of Wisconsin real estate at a sum which is less than 
 its present actual worth. By thus diminishing the value of 
 the property on which the tax rate is computed, the rate of 
 taxation will be increased and as this higher rate is to be ap- 
 plied to the assessed value of the railroad property, injustice 
 and inequity must result. 
 
 Further, if it is practicable to ascertain the present value 
 of real estate for the purpose of comparing and averaging 
 it with the values of previous years, then it is equally prac- 
 ticable to determine its present value for the purpose of fix- 
 ing the value of the general property of the state, and there 
 is no apparent justification, or excuse or reason for combin- 
 ing such value with the values of real estate which may have 
 obtained in other years. 
 
12 
 
 The purpose of the law and of the Board of Assessment is 
 to ascertain the value of real estate as of the year 1903, the 
 date as of which the assessment is to be made, and our efforts 
 should all be directed to ascertaining values as they existed 
 at that date. 
 
 It does not help us to know what the real estate of Wiscon- 
 sin was worth on May 1, 1903, to be told what its average 
 assessment has been, or what its average value has been 
 through five preceding years. If there is any relation be- 
 tween assessment values and the values that are expressed 
 in deeds of conveyance in the cases of sale, which will serve 
 our present purpose at all, then it must have reference solely 
 to 1903. Let me illustrate with a single example. 
 
 We will suppose that five years before the period when our 
 investigation begins, a particular farm was recognized as 
 being worth $2,500. The assessor will do pretty well 
 according to the practice which our investigations show to 
 be prevalent, if he assesses it at $1,500. Gradually, 
 through the progress of five years that farm has advanced to 
 a value of $5,000. It will probably — not necessarily, but 
 probably — have been assessed all the time at $1,500. The 
 changes in the appearance and conditions of the farm, will 
 perhaps have been slight and such as did not attract the as- 
 sessor’s attention as the years passed along. The practice 
 of the assessors is to repeat their previous figures or the fig- 
 ures of their predecessors, and it is more than probable 
 that at the end of the five years’ period, we will find the 
 farm which has advanced in value to $5,000 is still assessed 
 at $1,500. We started in five years ago with an assessment 
 of $1,500 on a farm which was worth $2,500. The ratio 
 of assessment to real value was therefore three-fifths. At the 
 end of the period we still have an assessment of $1,500, but 
 
13 
 
 the real value is $5,000 and the ratio of assessment is re- 
 duced to three-tenths instead of three-fifths. 
 
 This illustration is by no means either rare or fanciful. I 
 risk nothing in saying that its counterpart can be found in 
 nearly every town in the state, and what is here assumed as 
 to a single piece of property, will be found to apply to 
 large portions of many assessment districts. 
 
 Now, let us suppose that at some time during this five 
 years’ period a sale of some wood lot or pasture lot has been 
 made, and that in changing the name of the owner, the as- 
 sessor has also placed an assessment on that particular piece 
 of land at or near the consideration which was expressed in 
 the deed, and further, if there shall have been several such 
 unimportant transactions, the reported sales in these special 
 cases will show T that the ratio of assessment is quite or nearly 
 equal to the real value, and the conclusion will therefore be 
 reached that in the assessment district where these prop- 
 erties are situated, that the rate of assessment nearly equals 
 full value, although as we have seen, as to the vast majority 
 of the property, the assessment does not exceed 30 per cent, 
 of actual values. 
 
 The most serious objections to the use of the information 
 which may be derived from the reported sales of real prop- 
 erty to which I have already referred, as a basis for the as- 
 certainment of a ratio between assessment values and act- 
 ual values, are, however, altogether apart from the question 
 of whether said reports cover a period of one or more years. 
 
 Every one will consent that in order to render the informa- 
 tion derived from these reports of any value, they should 
 contain at least three factors on which we can absolutely 
 rely. 
 
 First. The consideration which is expressed in the con- 
 
I 
 
 14 
 
 veyance must be the actual consideration (expressed in 
 money) for which the property was sold. 
 
 Second. That the time as of which said consideration 
 is predicated, shall bear such relation to the time of the as- 
 signment as to negative the idea of any probable radical 
 change in value between the dates. 
 
 Third. That both the assessed value and the sale value 
 shall refer to the same property. 
 
 In a great majority of the reported sales some one or 
 more of these fundamental conditions do not exist. 
 
 As to the first, it is often found that the stated considera- 
 tion applies only to the money or notes which pass from the 
 vendor to the vendee, but that as a matter of fact there is 
 also included in said consideration, the assumption by the 
 vendee of mortgage incumbrances or other liens, which are 
 as much a part of the consideration as is the money which 
 is used in the transaction, but which do not appear as a 
 part of the price for which the property is sold. Easements, 
 privileges or burdens of various kinds, the extent and nature 
 of which can only be ascertained by reading the instruments 
 themselves, are of frequent occurrence but of course the 
 report to the Secretary of State furnishes no clue to any 
 such facts, although they often seriously modify the terms 
 which are stated in the document itself and renders the 
 facts on which the investigator relies for his information, 
 altogether misleading. 
 
 As to the second proposition it may be said that a great 
 many of the reported conveyances are made in the fulfill- 
 ment of contracts entered into between the parties many 
 years ago. The stated consideration is the sum for which 
 the property was sold when the contract was made. In 
 many instances the whole character of the property has 
 
15 
 
 changed between the date of the contract and the date of 
 the deed and the value may have greatly increased in that 
 interval. None of these facts, however, appear in the re- 
 port. It is impossible for any investigator to ascertain them 
 from the report furnished by the register of deeds. To him 
 everything appears to be fair, regular and complete, and 
 he has no choice but to use the recorded details as the basis 
 of his estimates, with the necessary result that his conclu- 
 sions are wrong, and such instances are sufficiently numerous 
 to vitiate any calculations which are based upon these re- 
 ports. 
 
 As to the third proposition it is frequently found that 
 property which is described in the assessor’s book and in the 
 deed of conveyance in identical terms, is far from being 
 the same property when it is sold and when it is assessed. 
 For example: A piece of property located in Madison or 
 
 Milwaukee and described as lot 4 in block 8 of said city, 
 may have an actual value of $50,000, of which one-half 
 may represent the land and one-half the improvements which 
 have been placed upon it. On the first day of May the 
 assessor places his value upon it, which is, say $40,000. The 
 assessment is therefore four-fifths of the real value. Now, 
 suppose that on the tenth day of June the improvement is 
 destroyed and that on the first day of July the property is 
 sold, the price obtained being the value of the land, or 
 $25,000. 
 
 On the 15th day of September the register of deeds in the 
 performance of his duty, reports to the Secretary of State 
 that lot 4 of block 8 was sold for $25,000, and that it had 
 been assessed for $40,000, or for three-fifths more than its 
 full value. The converse of this proposition would be true, 
 if instead of an improvement being destroyed, a similar one 
 
16 
 
 had been constructed in the meantime. In each case the 
 assessor and the register of deeds has described the prop- 
 erty as lot 4 in block 8 and both of these officers have prop- 
 erly performed their duty. But the inquirer who is looking 
 for information as to the relation between assessed and actual 
 values is led far astray by their reports. 
 
 Our Committee found that in the time at our disposal 
 it would be impossible to extend our examinations over th^ 
 entire state. It was necessary to limit the territory which 
 we would try to cover. We were aware that Milwaukee 
 County embraces about one-sixth or one-fifth of the prop- 
 erty values of the entire state, and it seemed as if we could 
 work there more effectively than we could in any other 
 one county of the state: and we began our investigations in 
 that locality. We secured the services of Mr. T. H. Brown, 
 who was for nine years Tax Commissioner of Milwaukee, 
 and w T ho is as expert and experienced in all matters relat- 
 ing to property values as any gentleman in the state. His 
 long period of service in the office named had made him 
 especially familiar with Milwaukee property. 
 
 The result of his investigations we place before you in 
 the form of a voluminous report, which, of course, we do not 
 expect to take time now to read, but it is as to the conclu- 
 sions which are reached in that report, that I am now about 
 to speak; a little later Mr. Brown will probably himself 
 speak in explanation of his report. Inasmuch as the work of 
 Mr. Brown was to a considerable extent devoted to testing 
 the trustworthiness of the report of the conveyances made 
 by the register of deeds, as a basis for ascertaining real es- 
 tate values, it might be helpful to have the law which pro- 
 vides for the making of that report read, so that we may 
 have in mind its exact terms. Mr. Dudley has, I believe, 
 
17 
 
 copied the essential portion of that statute and I will ask 
 him if he will kindly read it for us. 
 
 (Mr. Dudley hereupon read Chapter 373 of the Laws of 
 1903.) 
 
 Mr. Crandon : It is seen that the law itself excludes 
 
 from the reported sales a very large number of convey- 
 ances, and this is right. Mr. Brown found that during Ihe 
 year covered by his examinations and speaking in round 
 numbers, 8,000 deeds had been recorded in Milwaukee 
 County. Pursuing the process of elimination which is pro- 
 vided by the statute, the register of deeds had included in 
 his report to the Secretary of State 1,105 transactions. The 
 conveyances thus reported were submitted to a most caicful 
 scrutiny. 
 
 Mr. Curtis : Deported in what year ? 
 
 Mr. Crandon: The year preceding September 1, 1903. 
 
 It was determined to ascertain the exact conditions under 
 which each of these conveyances had been made. The deeds 
 were first carefully read and all the information which they 
 disclosed was fully noted. Mr. Brown’s extensive personal 
 acquaintance rendered it easy for him to confer with the 
 parties to the various transactions and learn exactly what 
 each one involved. This he did. He also examined the 
 several properties which were described in the deeds to 
 ascertain their physical condition and to inform himself 
 whether any important changes resulting from the construc- 
 tion or removal of improvements, or from the special busi- 
 ness changes in the adjacent locality, had taken place be- 
 tween the date of the assessment and the date* of sale of the 
 property involved and in this way he became familiar with 
 all the facts relating to each reported sale. The result was, 
 that of the 1,105 conveyances which had been included in 
 
18 
 
 the report of the register of deeds, 593 — more than one- 
 half — were found to be so defective or misleading that they 
 could not afford any reliable information as to the trans- 
 actions to which they referred. 
 
 These defects were of the most varied character. Often 
 the consideration w T as deliberately misstated. Many times 
 the consideration named took no account of existing mort- 
 gage obligations which were assumed by the purchaser and 
 which evidenced the value of the property quite as much 
 as did the cash payments noted in the transaction. So ex- 
 tensive is this feature of real estate transactions, that in 
 counties, other than Milwaukee, it was found to be a usual 
 practice. A certain number of deeds which had been re- 
 ported by the register were examined and it was found that 
 the aggregate consideration contained in the group, amounted 
 to $70,000, while the actual consideration was practically 
 twice that sum. I have forgotten the exact, amount, but 
 Mr. Dudley will report it exactly, which I am not now 
 able to do. It also often appeared that varying amounts of 
 personal property were included in the real estate deals, 
 but the value of such personalty w r as entirely omitted from 
 the deeds which were given for the property. While these 
 facts do not imply the slightest dishonesty or impropriety 
 on the part of the principals in the several transactions re- 
 ferred to, as neither law nor equity demands that all the de- 
 tails of a trade shall appear in real estate conveyances, they 
 do, nevertheless, illustrate how absolutely untrustworthy 
 these documents become as a source from which the informa- 
 tion which we are seeking, is to be secured. If, for example, 
 the examiner is led to assume that the value of certain prop- 
 erties which have been sold is $70,000, as just noted, when 
 the real value as it was fixed by the parties to the transac- 
 tion was $140,000, it goes without the saying, that conclu- 
 
19 
 
 sions based on the faulty information, must themselves be 
 unreliable. 
 
 But these misleading statements could not have been 
 known to the Tax Commission when it was making its investi- 
 gation, nor to Mr. Polley’s when he was revising the Com- 
 mission’s computations, or to anyone else who did not in- 
 form himself of the facts by a process equivalent to that 
 which Mr. Brown pursued. 
 
 After securing the necessary information as to the values 
 of the properties which had been sold, Mr. Brown exam- 
 ined the books of the assessors and ascertained the amount 
 of the various assessments which had been placed upon 
 them. All of this work consumed much time, but it was 
 so thorough and complete as to include all the information 
 as to values, which could be obtained from the actual real 
 estate sales. The result of it all was, that we have correct 
 information as to the price for which the several pieces of 
 real estate included in the report before you, have been 
 sold, and the actual assessment of the same, and hence 
 are able to determine the ratio between assessed and actual 
 values with an authority which cannot be intelligently ques- 
 tioned. 
 
 Mr. Brown will tell you that his examinations have estab- 
 lished the fact that all of the defects and inaccuracies which 
 I have brought to your attention, not only exist, but that 
 they exist to an extent which absolutely discredits any con- 
 clusions which are based upon an acceptance of the data 
 furnished by the register of deeds, without first subjecting 
 that data to a sifting process similar to that which was used 
 by himself, and I will leave to him any further elaboration 
 of this proposition which, may be desired. 
 
 The same sort of examination in every detail was made 
 
20 
 
 as to the property of the County of Milwaukee outside of the 
 city. 
 
 And now what is the result of all of this work? 
 
 It is before you in the report which is submitted by Mr. 
 Brown. I have acquainted you with the careful, pains- 
 taking and exhaustive process by which this information was 
 obtained. In tables with appropriate headings and explana- 
 tions will be found the description of the property, its real 
 value as determined, by Mr. Brown’s work, and the valuation 
 as it was fixed by the assessor. I do not. believe that any 
 information which approaches this report in point of relia- 
 bility can be ftund anywhere else. And from the report 
 it is found that the property of Milwaukee City is assessed 
 as about 52 per cent, of its actual value; 52.07 per cent, is, I 
 think, the exact fraction, and the property of Milwaukee 
 County outside of the city is assessed at 42.84 per cent. But, 
 accurate and reliable as we believed Mr. Brown’s work to be, 
 we w T ere not quite satisfied to rest our whole case on the in- 
 formation which was thus obtained. 
 
 There is a corporation in Milwaukee organized for the 
 especial purpose of appraising all sorts of properties. It 
 appraises properties in cases where other corporations are 
 being consolidated under the terms of the law, and the of- 
 ficers of the different companies need to know the value of 
 the property held by each individually. It appraises estates 
 where there is to be a subdivision of the property under 
 the order of the courts ; in a word, it appraises property of 
 all sorts and conditions. 
 
 The business of this corporation is so extensive and its 
 services are so often employed by litigants and courts, that 
 its work seems to be invested with a sort of semi-official char- 
 acter that commands the respect and confidence of the busi- 
 
21 
 
 ness community and to be frequently recognized by the 
 courts. Our Committee decided to avail itself of the serv- 
 ices of this corporation and we asked Mr. Brown to select 
 twenty pieces of real estate in each ward to be valued by 
 the Appraisal Company. The parcels of ground selected 
 for this purpose were to be representative properties, embrac- 
 ing residence, business, dock and manufacturing sites and 
 were to be taken from all parts of the city, and were not to 
 include any of the properties which had been considered in 
 his own report. 
 
 Mr. Brown made these selections and the list was sent to 
 the Appraisal Company. 
 
 Mr. Baldwin: The selections were made up of a certain 
 
 number of parcels in each ward ? 
 
 Mr. Crandon : Yes; it was intended to select about twenty 
 pieces in each ward. There was no knowledge on the part 
 of the Appraisal Company as to why we wanted that par- 
 ticular property examined and valued. We paid for this 
 service $2,000, or something of that kind. 
 
 Mr. Dudley: $2,500. 
 
 Mr. Crandon : $2,500 to go over the city and make ap- 
 
 praisals, just as they would if they were making them for 
 the subdivision of an estate, or for the purpose of consoli- 
 dation of companies, or for any other purpose, where the 
 sole object was to secure a statement of the actual value of 
 the land. The land alone was to be included in said valua- 
 tions; all buildings and other improvements were to be dis- 
 regarded. After the company had made its appraisal and 
 report, which we have here and which we herewith submit, the 
 value of each piece was compared with the value as stated in 
 the assessment roll — or the assessment of that particular 
 piece was set opposite to the appraisal. The result of that 
 
22 
 
 examination was that we found that the ratio of assessed 
 value to the value of the property as fixed by the Appraisal 
 Company very closely approximated that which had been 
 reached by another method by Mr. Brown. Will Mr. Dudley 
 give me the exact figures ? 
 
 Mr. Dudley: 52.57 per cent., and the result reached by 
 
 Mr. Brown by the other method was 52.07 per cent. 
 
 Mr. Crandon: These results are so nearly identical, al- 
 
 though arrived at by entirely different processes and by dif- 
 ferent men working each independently, that they seem to 
 confirm each other. 
 
 Now, gentlemen, not to weary you further with detail, 
 but for your information, let me say that a similar process 
 was gone through with for the property outside of the city 
 of Milwaul ee. 
 
 Mr. Peck : In the County of Milwaukee ? 
 
 Mr. Crandon : In the County of Milwaukee, but outside 
 
 of the city. 
 
 Mr. Baldwin : Unless you are going back to it, I would 
 
 like to have you or Mr. Dudley read the Appraisal Com- 
 pany’s own statement with regard to their work. 
 
 Mr. Crandon : I will stop for him to do that now, if he 
 
 will. 
 
 Mr. Dudley: Here is their report to which is attached a 
 
 certificate. 
 
 Chairman Gilson: What is the name of the company? 
 
 Mr. Dudley: The American Appraisal Company. 
 
 Chairman Gilson : The assessment you refer to as having 
 
 been employed is the assessment of 1902 ? 
 
 Mr. Crandon: 1903. All our work refers to 1903. 
 
23 
 
 Mr. Dudley (reading) : “The American Appraisal Com- 
 
 pany, a corporation duly organized, created and existing 
 under and by virtue of the laws of the State of Wisconsin, 
 hereby certifies, by its president and secretary, that it has 
 inspected and appraised the premises described in the ac- 
 companying schedule hereto annexed ; and hereby made a 
 part hereof, being certain lots and tracts of land situated 
 and being in the City of Milwaukee, County of Milwau- 
 kee, and State of Wisconsin ; and that after such inspection 
 it is of the opinion that said land and tracts of land con- 
 tained in said several descriptions mentioned in said sched- 
 ule are reasonably and justly worth the sums annexed to 
 said several descriptions. 
 
 American Appraisal Company, 
 
 By E. H. Bottum, 
 
 President 
 
 In addition to that is an affidavit, which sets forth the 
 nature of the company somewhat ; and here also is a pros- 
 pectus of the company, which shows in detail the work they 
 have done, and its character. 
 
 (Reading) : “John L. Moon, being first duly sworn, deposes 
 and says that he resides in the City of Milwaukee, Wiscon- 
 sin, and that he is secretary of the American Appraisal Co., 
 a corporation duly organized under the laws of the State 
 of Wisconsin, and located in the City of Milwaukee, Wiscon- 
 sin ; that said corporation was organized in March, 1898, 
 for the purpose of appraising property of large manufact- 
 uring industries, both real and personal ; and also property 
 of every name, nature and description for whatsoever pur- 
 pose. That said company has had an extensive experience 
 throughout the United States and the Dominion of Canada 
 in making appraisals, and has appraised property of the 
 value of many millions of dollars annually, during its exist- 
 ence; and that during the past year it has appraised for its 
 customers property, both real and personal, of the value of 
 $200,000,000 and over. That said company has in its em- 
 ploy many experienced men, and is thoroughly equipped, 
 competent and qualified to make such appraisal. 
 
 John L. Moon.” 
 
24 
 
 Mr. Baldwin: We propose to place the Appraisal Com- 
 
 pany’s report at the disposal of the Board of Assessment. 
 
 Mr. "Dudley : This report contains a list of the properties, 
 and here is the same list with the assessment of 1903 placed 
 opposite the description. 
 
 Mr. Haugen: Have you the assessment of 1903 of Mil- 
 
 waukee, or of the real estate? 
 
 Chairman Gilson : It is only the assessment of Ihe prop- 
 
 erty therein specified. 
 
 Mr. Haugen: You have not the total assessment? 
 
 Mr. Dudley I can give it to you presently. I will have 
 to look it up. I will give you presently the totals of each. 
 
 Mr. Curtis: In connection with the statistics from the 
 
 Appraisal Company are the names of the individuals whose 
 judgment has entered into the valuation given? 
 
 Mr. Dudley: That is not given in the report. We went 
 
 to the company and asked them to appraise the property in 
 the same manner that they would appraise it for any other 
 customer; and the work which they do in appraising real 
 estate consists very largely of cases where different companies 
 are to be consolidated and the real estate of each is put in 
 at its true valuation. This company acts as a sort of board 
 of arbitration, I suppose, in ascertaining the values. We 
 asked them to deal with the property named in our list in 
 that manner, and in their own way to ascertain the value of 
 the property. The various individuals who were actually 
 employed on the work I don’t know. It doesn’t state here. 
 
 Mr. Curtis : Of course', the figures represent the opinions 
 of individuals, either averaged or obtained otherwise. That 
 is why I inquired. 
 
25 
 
 Mr. Dudley: Yes; that is, they are not based necessarily 
 on the opinion of one individual. 
 
 Mr. Curtis : The corporation as such, could have no opin- 
 ion. 
 
 Mr. Baldwin: Could we not furnish, if the Commission 
 
 desire it, the names of the individuals who acted for the 
 Appraisal Company ? 
 
 Mr. Dudley: I don’t know of any reason why we could 
 
 not. These particular pieces were not properties that had 
 been sold. Of course, the report is not. based upon actual 
 sales, but the appraisers undoubtedly took into considera- 
 tion sales of property in the same neighborhood. 
 
 Mr. Peck: The men who made the appraisement are un- 
 
 doubtedly those experienced men spoken of in the certifi- 
 cate. It is said that the company employs a large num- 
 ber of experienced men in that business. It does not seem 
 to me very material what their names are, because the Com 
 mission probably would not know them, but it would be well 
 enough to furnish them. Ask them who they were. 
 
 Mr. Curtis : That is all Mr. Crandon? 
 
 Mr. Baldwin: We don’t know who they were at all. 
 
 Mr. Crandon : There was another method of ascertain- 
 
 ing the values of Milwaukee property, adopted by the Chi- 
 cago, Milwaukee and St. Paul Railway Company for its own 
 purposes. I will leave it for Mr. Dudley to tell you about 
 the method adopted because it is more familiar to him than 
 to me. The result of it was that a ratio of assessed to real 
 values was arrived at, which was about 47 per cent. Am I 
 correct ? 
 
 Mr. Dudley: Yes; 47 and a fraction. 
 
 Mr. Crandon: As I have already said outside of Mil- 
 
26 
 
 waukee City, but in Milwaukee County, this same process 
 which has been already described was pursued, with the 
 result of determining that the property outside of Milwau- 
 kee City is assessed at 42.84 per cent. 
 
 We claim now to have shown by the best evidence that is 
 in existence that Milwaukee County is assessed at not to ex- 
 ceed 50 per cent, of its real value. Unless the integrity of 
 our work is challenged, this conclusion must be accepted, 
 and any attempt to explain it away, or to make it fit any 
 theory which does not accept this result, will fail before 
 the facts which we have presented for your consideration. 
 The evidence that the assessment of Milwaukee County for 
 1903 does not exceed 50 per cent, of real value is convincing 
 and complete. 
 
 The facilities for pursuing our investigations beyond Mil- 
 waukee County w T ere not so good as those of which we 
 could avail ourselves for that county. However, this field 
 has not been neglected. 
 
 The Board will remember that there is a provision of the 
 Wisconsin law which enables any special locality, a city, or a 
 town, if it feels itself discriminated against in the matter of 
 equalization, to apply to the Circuit Court of the county for 
 a commission to equalize the assessed values between the dif- 
 ferent taxing districts. We found that there are a number 
 of counties where recently that sort of proceeding had been 
 had ; and we brought to our aid the men who had been 
 appointed upon those commissions, to tell us what they 
 found, — what their examinations had disclosed to them, — 
 in regard to the relation of real to assessed value. 
 
 Just let me read from one of them a statement of what 
 they did. This refers to Outagamie County. First it tells 
 how the appointment was made, and of the notice given of 
 
27 
 
 the commission’s appointment, and then goes on to say : 
 “After our appointment and qualification as such commis- 
 sioners and on and between the 8th day of June and the 7th 
 day of September, we made a general and careful review of 
 the property in each town, city and village in said county, 
 in order to ascertain and determine as accurately as possi- 
 ble, the value of all of said real estate, for the year 1902, 
 at the time the same was assessed ; and that before the final 
 determination by us upon the valuations which we were to 
 examine and review, we appointed a convenient time and 
 place in said county for the hearing of evidence and argu- 
 ments upon the valuations under review to be offered by 
 any taxpayer of any city, village or town in said county, 
 such time and place being at the court house on the 25th 
 day of August ; that we duly gave notice of such time and 
 place by mail, at least ten days before such time set for 
 hearing to the clerk of each city, village or town in the 
 county of Outagamie ; that we appeared at the time and place 
 mentioned in said notice, at which time Lyman E. Barnes, 
 John Bottensok and Thos. Ryan appeared for the peti- 
 tioner,” and other men whose names are given here appeared 
 for the towns and villages of the county. “And we pro- 
 ceeded to hear and did hear arguments from and on behalf 
 of the taxpayers of said cities, towns and villages, called for 
 and examined assessments, taxpayers and records in the 
 county, and continued to hear said evidence and arguments 
 in relation to' the valuation of property in said county, so 
 far as such valuation bears on the just aggregate valuation 
 of any city, village or town therein, each day from the 25th 
 day of August to the Jsr day of September, inclusive. That 
 we sat in such hearing of evidence and arguments for a 
 period of at least six days. That thereafter, upon due ex- 
 amination and consideration^of the evidence and arguments 
 
28 
 
 produced at said hearing together with said assessments and 
 records of the county bearing upon the valuations under re- 
 view, and all other facts obtained by review and examina- 
 tion as required by law, the said commissioners made their 
 findings, which were duly reported to the court. 
 
 “In our examinations we personally travelled over nearly 
 every road in the county; we examined the property in de- 
 tail; we familiarized ourselves with the values of real es- 
 tate, both from the prices asked by the owners, the values 
 fixed upon the same property by real estate dealers, and by 
 consideration of the sales which have taken place, and the 
 income which the property will produce'. As the result of 
 this examination, we find that the true value of the real 
 estate of Outagamie County for the year 1903 is at least 
 $36,106,351. The assessed value being $27,440,837, or 76 
 per cent, of actual value. 
 
 “In order that comparisons may be made between values 
 fixed by local assessors and true values, we attach hereto 
 a list of several assessments in each taxing district, and 
 our opinion of the true value of the same tracts of land, 
 said values being based upon our personal examinations.” 
 
 Now, of course, such commissions were not called for 
 or appointed in all the counties, and we could only avail our- 
 selves of the services of such as had been established. 
 
 Chairman Gilson: Right at this point, Mr. Crandon — 
 
 the aggregate of the value in Outagamie County found by 
 this commission is the same as the valuation made by the 
 county board, is it not? 
 
 Mr. Crandon : R o, sir. They find, as I understand it, 
 
 the value of the property in the several taxing districts, such 
 as towns, cities, etc., and then equalize the assessed valuation 
 between the different districts. The $36,000,000 named in 
 the report which I read, is, in the judgment of the men 
 who signed that report, the present value of the real estate 
 in Outagamie County. 
 
29 
 
 Mr. Haugen : Is that 1902 or 1903 ? 
 
 Mr. Crandon: The $36,000,000 is the value for 1903. 
 
 Mr. Haugen : But they were acting upon the assessment 
 
 of 1902 ; that is, the assessment they were endeavoring to 
 correct. 
 
 Mr. Crandon: $36,106,151 is their judgment of the pres- 
 ent, actual value. The assessment of this year is $27,440,- 
 837. 
 
 Mr. Curtis : The local assessment ? 
 
 Mr. Crandon : The local assessment. I won’t try to go 
 
 through with each one of these. We have reports from six 
 counties in which there were such commissions, and from 
 three or four counties, I don’t remember just exactly 
 which — where we got our reports as to assessed and real 
 values from the supervisors of assessments. The results 
 run from about, I think, 80 per cent, as the highest assessed 
 valuation to perhaps 54|- per cent, as the lowest assessed 
 valuation. 
 
 Mr. Curtis : That is the ratio between the local assess- 
 
 ment and the true value? 
 
 Mr. Crandon: Between the assessed value and the real 
 
 value. From which we deduced — or, rather I deduced, as 
 I believe my associates think that my estimate of the ratio 
 of assessment is a little too high — that as an average the 
 assessed value of the property outside of Milwaukee County 
 does not exceed two-thirds of its real value — 66 2/3 per 
 cent. 
 
 Mr. Curtis: You are still speaking of the local assess- 
 
 ment ? 
 
 Mr. Crandon : I am talking now entirely of the local as- 
 sessment as compared with the real value. The local assess- 
 
30 
 
 ment of the state for 1903 amounts to $1,120,086,060. 
 I claim that we have substantiated by the best 
 
 possible evidence, and by evidence that cannot be 
 refuted by anything in existence to-day, that Mil- 
 waukee County is not assessed at over 50 per 
 cent. And by less adequate and less comprehensive and less 
 specific information, but still by information that is better 
 than anything else that has been procured by any person 
 or that has been presented anywhere, or that exists any- 
 where, that the ratio of assessment to real value outside of 
 Milwaukee County does not exceed two-thirds of the value 
 of the property. 
 
 Since arriving here yesterday, we have received the re- 
 sults of the examinations in two other counties — Ozaukee 
 and Racine. I have not had an opportunity to tabulate 
 them. Mr. Dudley has done some work on that line, enough 
 to show that they present substantially the same conditions 
 and similar facts to those which are found to exist in other 
 localities. These examinations were made by Mr. Brown. 
 He has not completed his work, but it has been prosecuted 
 on the same theory that was adopted for Milwaukee County. 
 Mr. Brown, am I right in assuming that 50 per cent, will 
 give about the average between the assessed and real value 
 in those counties? 
 
 Mr. Thos. II. Brown: I believe that to be trueij sir. 
 
 Mr. Crandon : That is what I understood yesterday. 
 
 Here, then, are two other counties, important counties, in 
 which, so far as the actual assessment is concerned, for 1903, 
 it does not exceed 50 per cent, of the real value. Let me 
 say here, in passing, because I do not want to come back to 
 the subject again, the Committee will be very willing in- 
 deed, if the time permits it, — and I believe that there will 
 
31 
 
 be some time yet before the Board has to determine this 
 question of rates, will there not be? 
 
 Chairman Gilson : There will be some time. We cannot 
 
 now specify how much it will be. 
 
 Mr. Crandon : Then there is some time yet for continuing 
 these examinations before you need to determine finally what 
 is the real value of the general property of the state, isn’t 
 there ? 
 
 Mr. Gilson : There may be some, although if we should 
 
 undertake to verify any data you should present, it would 
 have to be done very soon, I think. 
 
 Mr. Crandon : The Committee will gladly extend these 
 
 examinations further if the Board considers that the re- 
 sults are valuable, and if there is any reason to expect that 
 the outcome of our work will be taken into account in the' 
 final computation. We have tried so to distribute our in- 
 quiries over the different parts of the state as to make our 
 calculations a fair average of the whole; and I think that 
 the work which has been done, while it has not, been entirely 
 satisfactory even to ourselves, and while perhaps no such 
 work could ever be exactly accurate, has, nevertheless, been 
 as effective in bringing out the facts that we need for the 
 purposes of this conference', as it has been possible to make it. 
 
 The line of examination as to the values of personal 
 property is very much less distinct and conclusive than that 
 which relates to real estate. Mr. Baldwin has that matter 
 in charge and will present it in detail so far as any conclu- 
 sions have been reached by the Committee. The subdivis- 
 ions of the assessor’s personal property schedules, are not 
 such as to make it possible to collect much information that 
 can be used to test the accuracy of said assessments. Of 
 
32 
 
 course, our Committee could not enumerate . the live stock 
 in the state, or ascertain the number or values of the pianos, 
 watches, wagons, carriages or sleighs in the state, but there is 
 an item entitled “Merchants’ and Manufacturers’ stock” 
 which is specifically set forth in the assessment schedules, 
 as to which some reasonably accurate information could be 
 obtained with the opportunity of comparing the same with 
 the assessors’ figures. 
 
 The amount of this item in the 1903 assessment roll for 
 the state is about $61,000,000. It was found by applying 
 to the merchantile agencies that there had been reported to 
 them by the men, who state, each for himself, the value of 
 what he had on hand of that sort of property, that it amounts 
 to at least $180,000,000, and probably there is enough of 
 similar property which is unreported, to bring up the whole 
 amount to not less than $200,000,000. 
 
 Such examinations as we have been able to make con- 
 vince us that not to exceed 25 per cent, of the actual value 
 of the personal property is assessed. We believe it to be 
 actually much less than that. 
 
 Some of the property that is assessed, is valued at more 
 than 25 per cent, of its real worth ; but there is a large 
 amount of property which is unassessed entirely, even of 
 those items which are assessed in classes, specifically and 
 by number. 
 
 Perhaps it will be objected that in dealing with property 
 that is not on the assessment roll, we are travelling outside 
 of the provisions of the statute. I understood that. I do 
 not know exactly what interpretation the Board is inclined 
 to place on that section of the law which relates to this 
 subject, but in any event this is truer. In all good con- 
 science the value of this property ought in some way to be 
 
33 
 
 considered when the rate of taxation on railroad property is 
 being determined by what the law designates, as the average 
 rate of taxation paid by the general property of the state. 
 
 We will assume, as was 1 said to me yesterday in the hotel — 
 that the assessment of personal property in this state and in 
 other states, is a mere farce; that it does not in any way 
 amount to an assessment; that it is a mere guess; that it is 
 the guess of an assessor based only on other guesses of peo- 
 ple who know little about the facts; that the assessor 
 not only does not get at a tithe of the property ; that he does 
 not half assess that which he really finds. Further, that 
 there are large amounts of personal property which he is 
 absolutely incompetent to assess. Consider for a moment, 
 if you will, what is involved in the matter of assessing the 
 merchandise in a large city like Milwaukee. Here is my 
 good friend Peck, one of the ablest men I know. Sup- 
 pose that he was called upon to assess a stock of fancy goods 
 in one store, a stock of dry goods in another, a stock of 
 jewelry in another, a stock of hardware in another, and 
 various stocks of clothing, shoes, harnesses, books and pict- 
 ures in succession. How, suppose that he has to pass from 
 one of those stores to another within the time allowed the 
 local assessor to make the assessment, and what kind of an 
 assessment would we get? What would it be worth as in- 
 dicating the value of the property? 
 
 Doubtless it would be a great improvement on what is 
 ordinarily secured because it would represent the judgment 
 of a man of rare ability and great experience. But unless 
 he had been specially and divinely endowed for that pur- 
 pose, even he could not make a fair assessment of such 
 varied and miscellaneous properties. 
 
 It is absolutely impossible for any one man to have the 
 
34 
 
 knowledge which will enable him to do that work. Put 
 every man in this room, including the members of the Board 
 of Assessment, on a commission to tell what is the value of a 
 well appointed jewelry store, and would an intending pur- 
 chaser give a fig for their combined judgment as to its value ? 
 But we are often asking of a man who has not a tithe of Mr. 
 Peck’s ability and experience, not only to do all that I have 
 suggested in my supposititious case, but also to fix the value 
 of all other kinds of. personal property in our largest cities. 
 The results of such an assessment are too farcical to com- 
 mand any kind of consideration except for the reason that 
 the law requires that we shall consider them. 
 
 But let it also be remembered that to a very large extent the 
 men who own this personal property, also own the real estate. 
 Of course this will not invariably be the case, but to a very 
 large extent it will be true, and it will be particularly true 
 in the rural districts. The men whose horses and hogs, 
 carriages and watches, escape assessment, whose moneys and 
 credits, whose grain and other farm products, whose stocks, 
 money and securities, all fail of assessment — they are the 
 very men who own the land with the value of which, rail- 
 road assessments are being compared. A method has been 
 adopted by the legislature which drags to the front and into 
 notice, so far as railroad property is concerned, every nail, 
 every bolt and tie. The various railway companies have 
 spent months of time and thousands of dollars in money in 
 the preparation of a report for this Board, which shows in 
 the minutest detail the physical condition of all their prop- 
 erties. Nothing has been left out. If the Board have ac- 
 complished what they set out to accomplish, and what they 
 had a right to accomplish, there isn’t a scrap of 
 paper in the office of any railroad company, the 
 value of which has not been brought under the 
 
35 
 
 surveillance of their judgment and knowledge for 
 the purpose of assessment. When the value of that prop- 
 erty has been thus disclosed even to the uttermost farth- 
 ing, the rate at which it is to be taxed is to be determined 
 by ascertaining a rate paid by taxpayers who escape an 
 assessment on a large proportion (perhaps one-half) of their 
 holdings. 
 
 And by just so much as their property fails to be assessed 
 and taxed, is the railway property unjustly burdened. 
 
 It was said by the Tax Commission in one of its reports, 
 without absolutely endorsing the proposition or expressing 
 an absolute opinion of its correctness, that they were at least 
 favorably impressed by the claim of economists that in a 
 state like Wisconsin, the personal property of the taxpayers 
 is more than equal in value to the real property. 
 
 Mr. Baldwin: I don’t think they went that far. 
 
 Mr. Crandon: I said I didn’t think they affirmatively 
 
 adopted that view, but that they inclined to it. 
 
 Mr. Peck: They said — without expressing themselves — 
 
 they did state that it was the opinion of well informed 
 economists that that was so. 
 
 Mr. Curtis: Didn’t they refer to that opinion and say 
 
 they regarded it as a proposition not proven ? 
 
 Mr. Peck: !No, sir; you remember you and I had a dis^ 
 
 pute about that and I introduced the record. You said 
 you didn’t say it, and then I read it to you. Don’t you re- 
 member that, Mr. Curtis ? 
 
 Mr. Curtis: Mo. 
 
 Mr. Peck: They didn’t say in so many words that they 
 
 approved it, but they certainly didn’t disapprove it, and 
 
36 
 
 they stated it as an opinion of the best informed, or well in- 
 formed, economists. 
 
 Mr. Crandon: Well, we have now a reported assessment 
 
 of this property of Wisconsin for the year 1903. That as- 
 sessment made by the local assessors fixes the value of the 
 real estate at $1,120,086,060. The assessment of the per- 
 sonal property amounts to $238,058,056. How does that 
 square with any theory of the economists, or of the Board, 
 or of anybody else ? Don’t the assessors know that it is a 
 farce? Don’t you know it, and don’t I know it, and don’t 
 everybody know it ? As already stated this personal prop- 
 erty is owned hv the men who also pay the real estate tax, 
 and when you are finding the rate of taxation on the general 
 property of the state in order to determine a rate which is 
 to be applied to whatever assessment you place upon the rail- 
 road property, you should do whatever you legally and prop- 
 erly may do — I don’t know how much that may he — but 
 it ought to include everything that by a liberal construction 
 of the statute you are authorized to do — to introduce into 
 that problem the values of the personal property which is 
 escaping taxation, and is thereby adding unfairly to the rate 
 of taxation which is placed upon railway property. 
 
 I do not want to take your time much, if any farther. I 
 appreciate the difficulties of the problem with which you 
 have to deal, and I appreciate the courtesy that has been ex- 
 tended to our Committee by this Board. I have an abiding 
 faith that the Board of Assessment earnestly desires to se- 
 cure equitable results and I believe that the Board has found 
 that our Committee is anxious to aid in working out the 
 problem fairly. Before making way for Mr. Dudley, who 
 has some important statistics and suggestions to present, I 
 submit an estimate of the actual value of the general prop- 
 erty of the state. 
 
37 
 
 It has already been shown that the local assessment in 
 Milwaukee County ought to be increased at least 100 per 
 cent, in order to make it equal to the real value of the prop- 
 erty. 
 
 Mr. Brown, who has just finished an investigation of the 
 ratio between assessment and real values in Racine and 
 Ozaukee Counties, reports that the same ratio between values 
 exists in those localities, and the reason for estimating the 
 assessment of the remainder of the state at not more than 
 66 2/3 per cent, of real value, has been stated. These are 
 the bases of the following: 
 
 Estimate. 
 
 LOCALITY. LOCAL ADD TO REAL VALUE. 
 
 ASSESSMENT. MAKE FULL 
 
 VALUE. 
 
 Milwaukee Co . . $173,577,574 100$ $347,155,148 
 
 Racine Co 26,610,098 100$ 53,220,196 
 
 Ozaukee Co 13,316,328 100$ 26,632,656 
 
 The State outside 
 of the above 
 
 three counties . 906,582,060 50$ 1,359,873,090 
 
 Personal property 238,058,056 4 times 952,232,224 
 
 $1,358,144,116 $2,739,113,314 
 
 Chairman Gilson : Before you conclude I wish you would 
 refer specifically to those reports which you desire to submit 
 so that we may have them entered on the record, if you will. 
 
 Mr. Crandon: Suppose that at the end of our argument 
 
 we hand you a list of all the reports, documents and tables 
 which we desire to submit, and which we will leave with you ? 
 
 Chairman Gilson : I want to inquire further in regard to 
 
 your statement of the report to you of the commercial agency, 
 
38 
 
 or one commercial agency, of the amount of merchandise in 
 the state. 
 
 Mr. Crandon : Mr. Baldwin will take that up in detail. 
 
 Mr. Baldwin : Yes, I will submit that. 
 
 Mr. Crandon : It is suggested to me that if you care to 
 
 have Mr. Brown speak in support of his report, or any analy- 
 sis of it, or if you would like to ask him some questions, 
 this would he a good time to have him make any statements 
 that the Board would like to hear. 
 
 Chairman Gilson : I don’t know as we care for any state- 
 
 ment, unless you desire to have Mr. Brown heard. 
 
 Mr. Baldwin : I think it would he desirable to have the 
 
 Board hear Mr. Brown. 
 
 STATEMENT OF THOMAS H. BROWN ON THE VALUE OF THE 
 
 REAL ESTATE IN MILWAUKEE, OZAUKEE AND RACINE COUN- 
 TIES. 
 
 Mr. Thomas IX. Brown: I do not think I can say any- 
 
 thing that will add one word to my report. 
 
 Mr. Bowers: You can state the result of your methods, 
 
 in short, which will help the consideration of your report 
 later. 
 
 Mr. Brown: I can tell you just exactly what I did. The 
 first thing I did was to go to the county clerk of Milwaukee 
 County and make a copy of the report for the year ending 
 September 1, 1903, of the sales reported by the register of 
 deeds of that county to the secretary of state. 
 
 Mr. Baldwin : As this goes into the record, would it not 
 
 be proper to have also in the record a brief statement of Mr. 
 Brown’s occupation, and how he came to take this up ? I 
 
39 
 
 should like to have him state that fact, so that it will be in 
 the record. Will you state, Mr. Brown, what your occupa- 
 tion is, and what your means of familiarity with this ques- 
 tion are, so as to have it in the record? 
 
 Mr. Brown: For the nine years preceding January 1, 
 
 1903, I was the tax commissioner of the City of Milwaukee; 
 since that time I have employed my time as a counsellor in 
 tax matters ; and for that reason I suppose I was called upon 
 by the railroad officials. 
 
 Mr. Baldwin: Will you please state how you came to 
 
 take this subject up, and what the instructions or suggestions 
 were, made to you, as to what was desired to be accomplished 
 by your investigation ? 
 
 Mr. Brown: I was simply asked by the railroad officials 
 
 to make an investigation of that report; to investigate that 
 report, and ascertain how much truth there was in it; to 
 dissect it, to analyze it. 
 
 Mr. Baldwin : Made by the register of deeds to the secre- 
 tary of state. As I said, I made a copy of that report, upon 
 blanks which I had printed, which enabled me to insert the 
 name of the grantor and the grantee ; and then we had a 
 wide margin for remarks. I went to the register of deeds’ 
 office and read over every deed ; and made a memorandum on 
 the margin wherever the deed itself showed that the consid- 
 eration was not the full consideration ; when it was made sub- 
 ject to some agreement, or some condition, or some lease, or 
 some other consideration. I made a memorandum of all of 
 those things ; and then, as far as possible and in nearly every 
 case, saw the grantor and the grantee, and asked them ques- 
 tions, ascertained the facts. Having obtained all this infor- 
 mation I made a record of it on the margin of this report. 
 
40 
 
 This report shows all that I know about the matter. From 
 memory I cannot tell you as to any particular piece, without 
 referring to the report ; and I don’t remember the total re- 
 sults either. 
 
 Mr. Baldwin: Mr. Brown, how many assessments are 
 
 there in the City of Milwaukee ? 
 
 Mr. Curtis : Of real estate, you mean ? 
 
 Mr. Baldwin : Of real estate, yes. 
 
 Mr. Brown: Well, here is the total result. The number 
 
 of sales for the year ending September 1, 1903, as reported 
 by the register of deeds, 1,105. Total consideration in deeds 
 as reported by the register of deeds, $2,695,333.31. 
 
 Mr. Curtis : That relates to the city alone ? 
 
 Mr. Brown: The whole county. 
 
 Mr. Curtis : Of Milwaukee ? 
 
 Mr. Brown: Yes. Total assessed value of the real es- 
 
 tate, sold, including buildings, as per last tax roll as reported 
 by the register of deeds, $1,773,918. 
 
 Total number of sales for the year ending September 1, 
 1903, 4,480. Total number of sales for the year ending 
 September 1, 1903, which appear to have been made under 
 ordinary conditions, in the usual course of business, for a 
 consideration expressed wholly in money, 573. Total num- 
 ber of sales for the year ending September 1, 1903, which 
 appear to have been made under ordinary conditions in the 
 usual course of business for a consideration expressed wholly 
 in money, and where the conditions at the time of sale were 
 the same as at the time the assessment was made, 512. Num- 
 ber of real estate assessments 119,819. Total consideration 
 of properties reported sold, where the conditions at the time 
 
41 
 
 of sale were the same as at the time the assessment was made, 
 and which sales appear to have been made under ordinary 
 conditions, in the usual course of business, for a considera- 
 tion expressed wholly in money, $1,025,194. Total assess- 
 ment for 1902 of properties reported sold where the condi- 
 tions at the time of sale were the same as at the time the 
 assessment was made, which sales appear to have been made 
 under ordinary conditions, in the usual course of business, 
 for a consideration expressed wholly in money, $502,950. 
 Total assessment for 1903 of properties reported sold, where 
 the conditions at the time of sale were the same as at the 
 time the assessment was made, which sales appear to have 
 been made under ordinary conditions, in the usual course of 
 business for a consideration expressed wholly in money 
 $517,085. 
 
 Total assessed valuation of real estate in 1902, $167,- 
 692,874. Total assessed valuation of personal property in 
 1902, $36,481,710. Total assessed valuation of real and 
 personal property in 1902, $204,174,584. Total assessed 
 valuation of real estate in 1903, $173,577,274. 
 
 Total assessed valuation of personal property in 1903, 
 $39,593,495. Total assessed valuation of real and personal 
 property in 1903, $213,171,069. Average percentage of 
 actual values at which assessment was made, as shown by the 
 report of register of deeds, 59.86. 
 
 Chairman Gilson: Would that embrace the properties, 
 
 the 500 sales, you examined, or a little over? 
 
 Mr. Brown: No; that is as shown by the register of 
 
 deeds. 
 
 Mr. Haugen : That is before you made the eliminations ? 
 
 Mr. Brown: Yes. What the actual value of the assessed 
 
42 
 
 property would be, measured by the percentage shown by 
 the report, $356,221,778. The average percentage of actual 
 values at which assessments are made, as shown by the re- 
 vised report of the register of deeds, 49.37, but the actual 
 value of the assessed property would be measured by the per- 
 centage established by the revised report of the register of 
 deeds, $431,722,638. 
 
 Chairman Gilson: Is that of the County of Milwaukee? 
 
 Mr. Brown: The entire county. 
 
 Chairman Gilson: Have you the separate valuation of 
 
 the city ? 
 
 Mr. Brown : Every ward ; every assessment district ; right 
 here. 
 
 Mr. Baldwin: I would like, if Mr. Brown can, by refer- 
 ring to instances, to have him illustrate the method 
 which he has adopted ; give illustrations of the way he has 
 in certain cases said such a report he would reject, and an- 
 other one he would accept. Of course he couldn’t go into that 
 in detail, but just enough to illustrate, so that you may get 
 an idea of the manner in which he performed the work. 
 
 Mr. Brown : Mr. President, I think my report on 
 
 Ozaukee County will state it better than I can give it by 
 picking out instances in this long report. The statement 
 of the register of deeds of Ozaukee County for the year end- 
 ing September 1, 1903, made in compliance with the statute, 
 reports 141 sales. An examination of the statement, and 
 of the records in the office of the register of deeds of Ozau- 
 kee County shows that 24 of those sales were made and the 
 deeds of conveyance recorded prior to September 1, 1902. 
 Your instructions were to include deeds which were re- 
 corded after, but made subsequent to April 30, 1902. These 
 were all made and recorded prior to September 1, 1902. 
 
43 
 
 Mr. Haugen : We have tried to eliminate those convey- 
 
 ances that did not comply with our instructions when the 
 report reached us. 
 
 Mr. Brown: I am simply showing what I eliminated. 
 
 That is one class. The examination shows that 24 of those 
 sales were made, and the deeds of conveyance recorded 
 prior to September 1, 1902. That of the remaining 117 
 sales, 21 were made subject to encumbrances which the 
 grantees assumed. That the consideration of these 21 sales 
 given in the register’s statement is $70,112.50. That the 
 consideration, including encumbrances — the actual consider- 
 ation is — $102,467.50. That the assessed valuation of the 
 21 pieces is $52,230. That 11 sales were made for con- 
 siderations not expressed wholly in money. That is another 
 class that was thrown out. That the description of land 
 in one deed does not tally with the description in the reg- 
 ister’s statement. There are several of those in this re- 
 port. That 20 pieces of land were sold each for less than 
 the assessed valuation, the total consideration being $20,- 
 124, and the total assessed valuation being $24,180. 
 
 Mr. Curtis : Hid you exclude those ? 
 
 Mr. Brown: Ho, I didn’t exclude those, but they ought 
 
 to have been excluded, because on the face of the returns 
 it appears that it is not true that 10 pieces of land were 
 sold for exactly the assessed valuation. Those were not 
 excluded either. That the assessed valuation of all the prop- 
 erty reported sold by the register of deeds is 79$ of the 
 consideration by him reported; and that the assessed valua- 
 tion of the 21 pieces sold subject to encumbrances which 
 the grantee assumed, is 50$ of the actual consideration. 
 
 The same condition exists in Bacine County. 
 
44 
 
 Mr. Polleys: Did you make any computation to acer- 
 
 tain, after your process of elimination, the aggregate realty 
 value of Ozaukee County? 
 
 Mr. Brown : No, sir. Here is a summary of all of those 
 things. 
 
 Mr. Baldwin: In Ozaukee County? 
 
 Mr. Brown: No; Milwaukee County. In the first column 
 is the number of sales for the year ending September 1, 
 1903, as reported by the register of deeds. Then the total 
 consideration in deeds as reported by the register of deeds; 
 and then the total assessed valuation of property, including 
 buildings, as per last tax roll, as reported by the register 
 of deeds. Total number of sales ending September 1, 1903, 
 as reported by the register of deeds. Total number for the 
 year ending September 1, 1902, which appear to have been 
 made for a consideration expressed wholly in money. That 
 is, after the corrections have been made. Total number 
 of sales where the consideration at the time of sale was the 
 same as the time the assessments were made. That has 
 been referred to by Mr. Crandon. There are a great many 
 of them in Milwaukee County, in the City of Milwaukee, 
 where, of course, the assessment reported was the assessment 
 of 1902 ; made in May and June, 1902. The property was 
 sold subsequent to September 1, 1902, after the assessment 
 was made; and at the time the sale was made either a build- 
 ing had been removed by fire, or removed in some other 
 way, or a new building had been erected, and the sale was 
 made for the property with the new building, or with the 
 old building removed. 
 
 Mr. Curtis: In a changed condition. 
 
 Mr. Brown : In a changed condition, so that the assessed 
 
 valuation as to those sales should not be considered at all. 
 
45 
 
 Mr. Haugen: That would not appear on the face of the 
 
 deed ? 
 
 Mr. Brown: Ho. 
 
 Mr. Haugen : You ascertained that by personal investi- 
 
 gation ? 
 
 Mr. Brown : Yes. 
 
 Mr. Haugen: You found some cases where buildings 
 
 were destroyed after the 1st day of July, after the meeting 
 of the Board of Review, and the land only was sold ? 
 
 Mr. Brown : Yes. 
 
 Mr. Haugen : How many of those cases did you find ? 
 
 Mr. Brown : I can’t tell without counting. 
 
 Mr. Haugen : Then you found other instances of build- 
 
 ings constructed after the 1st of July, and the land sold is 
 with the building? 
 
 Mr. Brown : Yes. 
 
 Mr. Haugen : And that would increase the value of the 
 
 property for sale, above the assesment ? 
 
 Mr. Brown : Yes. 
 
 Mr. Haugen: How, how did the relative number of one 
 
 class of cases compare with the relative number of the other 
 class of cases? Wouldn’t one offset the other? 
 
 Mr. Brown: I couldn’t answer that. 
 
 Mr. Haugen: Would there be likely to be as many or 
 
 more instances where property was increased by the con- 
 struction of a dwelling, than where the building was de- 
 stroyed ? 
 
 Mr. Dudley : There would be the natural increase in the 
 
 value of the land, anyway. 
 
46 
 
 Mr. Haugen: Mr. Crandon spoke of cases where the 
 
 buildings were destroyed after the 1st day of July, or after 
 the time of sitting of the Board of Review; so that when 
 the property was sold it was sold for a less consideration 
 than the assessed valuation. How, there must be a number 
 of instances where buildings were constructed after that 
 period, and the property would be sold for much more than 
 the assessed valuation, because it would include the building. 
 I wanted to find out whether one would not about offset the 
 other. Of course we cannot tell anything from the records 
 as to those cases. 
 
 Mr. Brown: The law provides those shall be excluded 
 
 from the report. 
 
 Mr. Haugen : Yes, if the register knows the facts. 
 
 Mr. Brown : Yes ; but he should be provided with the 
 
 means for ascertaining the facts, before making his report, 
 if the report is to be considered at all. 
 
 Mr. Haugen : The law has not provided the means. 
 
 Mr. Brown : But you are asking me to provide some- 
 
 thing — 
 
 Mr. Haugen: I thought possibly you had pursued your 
 
 investigations to such an extent that you could tell how 
 many of this class of cases appeared. 
 
 Mr. Brown: Ho, sir. Here is another class: Fulfill- 
 
 ment of land contract made ten or twelve years ago. There 
 the price of property was fixed at that time. 
 
 Chairman Gilson: How many instances did you find of 
 
 that kind ? 
 
 Mr. Brown: A good many of them. In fact, take the 
 
 over eight thousand sales made in Milwaukee County in 
 
47 
 
 the year ending September 1, 1903, the great majority of 
 them were in fulfillment of land contracts and trades. 
 
 The condition in Milwaukee County for the last thirteen 
 years has been rather peculiar — or for the last ten years, 
 if you please. During 1890, ’91, ’92 and part of ’93 there 
 was a boom in real estate in Milwaukee County, and values 
 were put up way beyond what experience has taught us 
 could be maintained; and everybody that had a few dollars 
 surplus during those three years invested it in real estate, 
 or nearly every one of them. So that in Milwaukee city and 
 county there were thousands of people who had bought lots 
 here and there all over the city, and all over the county; 
 bought tracts of land as an investment. They hadn’t money 
 enough to pay for the investment at the time. They bought 
 on credit, paying a little down. During the last ten years 
 these people have been getting tired. They have been unable 
 to carry the load, and they have been trading it for this, that 
 and the other thing, cats and dogs, to get rid of it, and get 
 out from under the load; sometimes selling for prices that 
 were half what they paid for it ten years ago. That has 
 been the condition in the City of Milwaukee. I think they 
 have just about unloaded all that sort of property. I think 
 now it is in a healthy condition. But for the last ten years 
 it has been a very difficult matter to tell what property was 
 worth in Milwaukee. Of course there are some locations, 
 like the corner of East Water and Wisconsin streets, and 
 West Water and Grand avenue, and up on Prospect avenue, 
 a residence district, and over on National avenue and First 
 avenue — some few localities that you can pick out where 
 property has appreciated very materially in value; but it 
 is not true of the city as a whole. 
 
 Mr. Haugen : The last assessment made under your 
 
48 
 
 supervision as tax commissioner of Milwaukee was made in 
 1902? 
 
 Mr. Brown: The assessment was made in 1902, and I 
 
 was tax commissioner. 
 
 Mr. Haugen : That was the last made under your direc- 
 
 tion. What was the total valuation of the city at that time 
 as found by you — of the real estate, say, first ? 
 
 Mr. Brown : The total assessed valuation of real estate ? 
 
 Mr. Haugen: Yes. 
 
 Mr. Brown : Ho you mean the City of Milwaukee ? 
 
 Mr. Haugen : The City of Milwaukee, under the last as- 
 
 sessment made by you, in 1902. 
 
 Mr. Polleys: I have the 1902 assessment of Milwaukee 
 
 realty. 
 
 Mr. Haugen : That is, of the city. 
 
 Mr. Polleys: I have it here, quoted from the regular 
 
 abstract of assessment in the Secretary of State’s office : 
 “$146,730,320.” 
 
 Mr. Haugen : And the personal property ? 
 
 Mr. Polleys: The personal property I have not. 
 
 Mr. Haugen : What have you for the county, Mr. Tol- 
 
 leys ; the local assessment ? 
 
 Mr. Polleys : The local assessment I have of the county, 
 
 outside of Milwaukee, was twenty million. 
 
 Mr. Baldwin : Mr. Brown, as an expert, based upon 
 
 your experience in these examinations which you have made 
 in Milwaukee County, and these other counties, what if any 
 accuracy can he attributed to the percentages of assessment to 
 true value, derived from the report to the Secretary of 
 State by the Register of Deeds ? 
 
49 
 
 Mr. Brown: My own idea, from my experience, is that 
 
 they are of very little if any value. The Register of Deeds 
 of Milwaukee County said to me last week that the report 
 was a farce. Here is another class, special guardian deed. 
 
 Mr. Haugen: That ought to he excluded. How many 
 
 were included of those? 
 
 Mr. Brown : I can’t tell you ; hut the report shows ex- 
 
 actly just why each one should he excluded. The law pro- 
 vides it, and I have followed the law exclusively. 
 
 Chairman Gilson : In the report do you give the name of 
 the grantee and the grantor in the conveyances ? 
 
 Mr. Brown: Ho; I recopied this on another blank. 
 
 Chairman Gilson: I wanted to know whether this report 
 
 would contain the names of the grantor and grantee, for in- 
 vestigation if it was desired to make it. 
 
 Mr. Brown : Ho ; but I can give that to you. I have 
 
 that at my office at home. Well, I have got each ward by 
 itself. Each assessment district by itself. 
 
 Mr. Haugen : You have not summed up the City of Mil- 
 waukee, from the rest of the county? 
 
 Mr. Brown: Yes. 
 
 Mr. Crandon : Mr. Dudley has analyzed that whole matter 
 in his brief, about these facts that are being inquired of, as 
 to the values of different locations ; different specific tracts 
 or districts, which will be all brought out in perfect detail 
 by Mr. Dudley when he makes his presentation. 
 
 Mr. Brown : Then I perhaps better take my seat until 
 
 you want to ask me some questions later on. 
 
 Mr. Curtis: Just one question, Mr. Brown, while you are 
 on your feet: These investigations of the Register’s records 
 
 were conducted by you personally ? 
 
50 
 
 Mr. Brown: Yes. Of course I had help. I never could 
 have done it alone. 
 
 Mr. Curtis: But you were giving active attention to just 
 
 what was going on ? 
 
 Mr. Brown : All the time, yes, sir. 
 
 Mr. Curtis: The investigation of conditions outside of 
 
 the record, such inquiries as you had to pursue with the 
 parties to the conveyances, those were conducted by you in 
 part personally, and in part by assistants, I suppose ? 
 
 Mr. Brown : Yes. 
 
 Mr. Curtis : Roughly, what proportion were you able to 
 
 conduct personally? 
 
 Mr. Brown: Well, so far as the compilation of the re- 
 
 port is concerned, I did that all myself. 
 
 Mr. Curtis : Your outside investigations, how much of 
 
 that were you able to conduct personally — speaking roughly ? 
 
 Mr. Brown : Oh, perhaps 25^ of it. 
 
 Mr. Curtis: The examination of properties to determine 
 
 whether there was any change in conditions since the as- 
 sessment, were those examinations conducted by you per- 
 sonally in whole or in part ? 
 
 Mr. Brown: Yes, through the assessors. I went right 
 
 to the records, and got that from the assessment roll. The 
 assessment roll of 1902, would show a vacant property, if 
 you please, and the assessment of 1903, would show a build- 
 ing on that property. 
 
 Mr. Curtis: You ascertained then by a comparison of 
 
 the data appearing upon the roll ? 
 
 Mr. Brown: Yes; and by asking the assessor about the 
 
 facts in the matter. 
 
51 
 
 Mr. Haugen : Then you would have to inquire further, 
 
 as to whether the building was constructed before or after 
 the time of the sale ? 
 
 Mr. Brown : Yes. That appears upon the books of the 
 
 assessor. 
 
 Mr. Haugen : Ho, that wouldn’t appear upon the books 
 
 of the assessor. 
 
 Mr. Brown: Well, the books of the assessor of the City 
 
 of Milwaukee, I am talking about. 
 
 Mr. Haugen : The books of the assessor would show there 
 
 was no building on the premises in 1902, but there was in 
 1903. But, a sale was made, say in December, 1902 ; 
 whether or not the building was constructed before or after 
 the time the sale was made in December would not appear, 
 would it % 
 
 Mr. Brown: The assessors of the City of Milwaukee, 
 
 each one has a plat book. On a page is every block, and 
 that is of sufficient size so that the size of each parcel, each 
 lot or part of a lot, is noted on that book. On the lot side 
 of it he puts down the building. Outside he puts down the 
 value of the lot, and the date when he makes it; and he 
 notes when there has been a change by removing a build- 
 ing ; when there has been a new building constructed he notes 
 that, and puts down the date, so that there is no guess work 
 about it. 
 
 Mr. Haugen : The date of the completion of the build- 
 
 ing? 
 
 Mr. Brown : Yes. And when he makes his assessment 
 
 you will see frequently upon the assessment roll the words 
 “incomplete” or “unfinished.” He assesses a building half 
 finished, if you please. 
 
52 
 
 Mr. Haugen : But, if the building was completed in De- 
 
 cember, remote from the time of assessment, does he indi- 
 cate that on his plat, that it is completed in December ? 
 
 Mr. Brown: Ho. 
 
 Mr. Haugen: He only indicates whether completed or 
 
 not at the time of the assessment? 
 
 Mr. Brown: Yes. 
 
 Mr. Haugen : Then there would not be anything to show 
 
 on the record, if the sale was made in December, whether 
 or not at that time a building which was not on the premises 
 at the previous assessment had been completed ; they wouldn’t 
 be able to show that ? 
 
 Mr. Brown : I don’t know as I understand. 
 
 Mr. Haugen : A sale is made of a piece of land in Decem- 
 ber, 1902, and at the time of the assessment in 1902, that was 
 vacant. At the time of the assessment in 1903, there was a 
 building upon it ; whether or not that building was completed 
 before or after the time the sale was made in December would 
 not appear. 
 
 Mr. Brown: Ho, that would not appear upon the books. 
 
 But the fact that a lot was assessed in 1902, at a thousand 
 dollars, and the next year at three thousand dollars, would 
 indicate to me that some change had taken place in that 
 property, and I would investigate it, and find out. 
 
 Chairman Gilson : Mr. Dudley, you have submitted here 
 
 Mr. Brown’s valuation of the specific pieces of property and 
 conveyances which he considers proper to be considered in 
 ascertaining the value in Milwaukee city and county. He 
 took the register’s return to the Secretary of State for the 
 year 1903, for the basis of his work. 
 
 Mr. Dudley: Yes. 
 
53 
 
 Mr. Gilson : And he then proceeded to make certain 
 
 eliminations. 
 
 Mr. Dudley: Yes. 
 
 Chairman Gilson : Can you furnish us with a copy of 
 
 the register’s report, showing the eliminations which he made ? 
 
 Mr. Dudley: The whole thing is there. 
 
 Mr. Curtis: Will the document there indicate which 
 
 items were and which were not included in his final calcu- 
 ation ? 
 
 Mr. Dudley: Yes. 
 
 Chairman Gilson : Does it indicate, so that in taking up 
 
 the report we can ascertain what conveyances were excluded, 
 and what included in this ? 
 
 Mr. Dudley: Yes. This is shown hv assessment dis- 
 
 tricts. 
 
 Statement of A. S. Dudley on The Value of the Real 
 and Personal Property in Wisconsin Sub- 
 ject to Taxation. 
 
 Mr. A. S. Dudley: Mr. Chairman, and gentlemen. — I 
 
 really don’t know that I have anything to submit additional 
 to what has already been presented to you. I think that 
 what I have here committed to writing will, however, serve 
 as a partial recapitulation, perhaps, of what has been pre- 
 sented to you by Mr. Crandon and Mr. Brown. 
 
 The law, the practical administration of which is now 
 under consideration, was passed by the last legislature for 
 the avowed purpose of taxing railroad property uniformly 
 and equitably as compared with the taxation of other classes 
 of property. The method prescribed by the statute for se- 
 
54 
 
 curing this uniformity consists in ascertaining the true value 
 of the railroad property, and the application to that valuation 
 of the average rate of taxation which is sustained by the 
 general property of the state. The average rate is to be 
 determined by dividing the total taxes paid by the general 
 property by the true value of such property. The true 
 value of the general property is the subject with which we 
 now have to deal. 
 
 Values fluctuate from year to year and in a growing com- 
 monwealth there is a steady enhancement in the value of 
 lands and a constant increase in the value and quantity of 
 improvements and personal property. The question is there- 
 fore material, “as of what date is the general property of 
 the state to be valued V ’ It is evident, I think, that the rail- 
 road property must be valued as of the same date as the 
 general property. If two men have property of equal pres- 
 ent value it would be manifestly unjust to tax the property 
 of one upon its value now and the property of the other on 
 the greater or less valuation which it had at some former 
 period. 
 
 The assessment of 1903 of general property was made 
 last May and June. Railroad property was exempt from 
 assessment at that time because it paid in lieu of taxes of 
 1903 a license fee. The statute calls the assessment of rail- 
 roads about to be made the “Assessment of 1904”; but it 
 is evident that this assessment can not be compared with 
 the general property assessment of 1904, which has not been 
 made, nor can this railroad assessment of 1904, which un- 
 der the theory of the law is made in 1903, be regarded as 
 covering the property owned by the railroad company on 
 May 1 , 1904. It seems, therefore, that what the law terms 
 the railroad assessment of 1904 means merely the entire 
 
55 
 
 process of levying upon railroads the taxes which are to be 
 paid in the year 1904; and the date as of which railroads 
 are to be valued in order to secure any semblance of uni- 
 formity must he the date of the general property assess- 
 ment of 1903. 
 
 That a comparison or equalization of the value of rail- 
 road and general property is to be made with reference to 
 their respective values at the date of the general assess- 
 ment of 1903, is further evidenced by considering the method 
 prescribed by the statute for computing the average rate. 
 Section 9 provides that, “The board not later than the first 
 day of November in each year * * * shall^ according 
 
 to their best knowledge and judgment, ascertain and deter- 
 mine the true cash value of all the general property of the 
 state assessed and to be taxed in the then present year ” 
 Section 11 provides for the ascertainment of the aggregate 
 of state and local taxes of the same year, and section 14 pro- 
 vides that, “From the aggregate true cash value of the 
 general property of the state and the aggregate of taxes so 
 determined and entered on the records the board shall com- 
 pute and determine the average rate of taxation.” The 
 problem, therefore, is to determine the true cash value in 
 May, 1903, of the general property of the state which sus- 
 tained the general taxes of 1903. 
 
 That the local assessment of 1903 does not represent 
 true value is admitted, but the magnitude of the task and 
 the practical impossibility of making a re-appraisal as of 
 May, 1903, and the absence of other data, compel us to give 
 greater consideration to the reports of local assessors than 
 they would otherwise deserve. 
 
 We believe that the value of property in 1903 cannot 
 be determined by a consideration of the average values of 
 
56 
 
 the same or other property during the previous five or seven 
 years. We contend that the application of an average ratio 
 existing between assessed and true value during a period 
 of five years (assuming that such ratio has been accurately 
 obtained) to the average assessed value of the same years 
 cannot result in giving the true value of property at any- 
 particular time. The present actual value would necessar- 
 ily exceed such an hypothetical true value based on an 
 average of the values of past years for the reason that as 
 a whole lands and town and city lots have year by year ap- 
 preciated in value. Any so-called “Average value” must, 
 therefore, be less than the present value. The theory of 
 taking an average value of several years would possibly have 
 more to commend it if such average value were to he divided 
 into the average taxes paid during the same years to fix the 
 average rate. But to divide the general property taxes of 
 1903 by any such average true value would neither be just 
 to the railroads nor comply with the law which requires 
 that the taxes be divided by the true cash value of the gen- 
 eral property of the state upon which said taxes were levied. 
 We believe that in the determination of the true value of gen- 
 eral property for any particular year that no other assess- 
 ment roll or ratio of assessment should he considered than 
 the assessment roll of that particular year and the ratio 
 between assessed and true value which was employed by 
 the assessor at that time. We have only to do with the gen- 
 eral property of 1903, and the general property of no other- 
 year is identical with it. 
 
 The ratio between assessed and true value used in mak- 
 ing the rolls of 1903 cannot be ascertained by reference 
 to the reports of registers of deeds transmitted to the Sec- 
 retary of State under Sec. 1007, as amended by the laws of 
 
57 
 
 1903, for the reason that the sale price is compared with 
 the assessment of 1902, giving the ratio used in 1902, and 
 in considering the assessment roll of 1903 it is immaterial 
 what ratio was used in 1902. But even assuming the gen- 
 eral property of 1902 and 1903 to be identical in quantity 
 and actual value, so that if the actual value of the general 
 property of 1902 were ascertained the same figure might 
 he used for the actual value of the general property of 1903, 
 we are still of opinion that the ratio shown by the figures 
 reported by the registers of deeds is of little value. And 
 this opinion is based upon a careful investigation of the 
 report of the register of deeds of Milwaukee County and 
 upon such other investigation as we have been able to make 
 in two adjoining counties. 
 
 The register of deeds of Milwaukee County for the 
 year ending September 1, 1903, reported 1105 deeds un- 
 der the law referred to. The total consideration in these 
 deeds was $2,695,331, and the assessed value of 1902 as 
 reported by the register was $1,773,918, giving a ratio of 
 65.81$. 
 
 Mr. Brown’s figures and mine do not exactly agree. In 
 the figures which he has given the value of each ward was 
 computed separately, and the total valuation of the wards 
 added together, to get the true value of all the property in the 
 city. But we thought it reasonable to consider the city as a 
 whole. I have taken the sum of the considerations in the 
 336 deeds, or whatever the number was, and their assess- 
 ment to secure a ratio of assessed to true value for the entire 
 city. In other words, Mr. Brown’s figures are based on a 
 consideration of the ward as the unit, while I have treated 
 the city as the unit. 
 
 Chairman Gilson: Have you computed the valuation on 
 
 the assessment of 1902 ? 
 
58 
 
 Mr. Dudley: 1903. We have tried to find as nearly as 
 possible the true value of the property as near the date of 
 assessment of 1903 as possible. The Appraisal Company 
 was instructed to get the value as of May 1, 1903. Then if 
 we get the assessed value at the same date we have a ratio we 
 thought would be of value. 
 
 Chairman Gilson : The sales, many of them, perhaps 
 
 half of them, would he as near May 1, 1902 as 1903, would 
 they not — the date of the sales ? 
 
 Mr. George R. Peck: Reported the 1st of September. 
 
 Mr. Haugen : But the sales reported commence on the 
 
 first of May, 1902. 
 
 Mr. Dudley: Hot under the law. 
 
 Mr. ITaugan : Under our instructions. That is, we ask 
 
 them to report all sales made after the 1st day of May of 
 the preceeding year, but not recorded until after the 1st of 
 September. Those that were recorded before the 1st day of 
 September of the preceding year are excluded. But those 
 recorded after the 1st of September are included in order 
 to get as many as possible. 
 
 Mr. Dudley: The law excludes those either made or re- 
 
 corded. Your instructions are to include those made prior 
 to September 1st hut recorded after September 1st. 
 
 Mr. Haugen : Yes ; in order to get as many data as pos- 
 
 sible. 
 
 Mr. Dudley: The trouble is it seems to produce confu- 
 
 sion. Some registers have followed the statute. And your 
 instructions, I think, are clearly repugnant to the statute. 
 
 Each of these 1105 deeds have, however, been read in 
 full, the parties to the transaction, witnesses or agents, 
 have been interviewed, and the conclusion reached is that 
 
59 
 
 593 of the 1105 deeds can not properly be used in any 
 theory of determining a ratio of assessment. We do not say 
 that including these 593 deeds in his report was in each in- 
 stance an error on the part of the register of deeds, for the 
 fact that they should be excluded was, in many instances, 
 not apparent on the face of the deeds, but could only be 
 ascertained by further incpiiry into the circumstances at- 
 tending the transactions. 
 
 The total consideration in the 512 deeds in which the 
 consideration was found to be an expression of actual value 
 amounted to $1,025,194, and these 512 descriptions were 
 assessed for the year 1903 at $517,085, so that a ratio is 
 obtained for 1903 for Milwaukee County, based upon a re- 
 vision of the sales reported by the register of deeds and the 
 assessment rolls of 1903, of 50.44$. Considering only the 
 sales in the City of Milwaukee the number reported by the 
 register of deeds was 789 of which it was found, after this 
 process of investigation and elimination, that only 336 re- 
 mained for use in arriving at a ratio. The ratio of the reg- 
 ister of deeds based upon the consideration given in the 789 
 deeds and the assessment of 1902 was 67.89$ for the City 
 of Milwaukee. The ratio based upon the total considera- 
 tion of the 336 deeds and the assessment of 1908 was 52.07$. 
 The total number of sales in Milwaukee County outside of 
 the City of Milwaukee reported by the register of deeds 
 was 316, and the ratio between the assessed value of 1902 
 and the consideration reported was 52.12$. After investi- 
 gation it was found that only 176 of the 316 deeds could 
 be regarded as competent evidence in the determination of 
 the ratio, and the ratio existing between the consideration 
 in these 176 deeds and their assessed value of 1903 was 
 42.84$. 
 
60 
 
 JSTow if we apply these 1903 ratios to the assessed values 
 of 1903, we obtain the following figures for the value of 
 Milwaukee County: Real estate of Milwaukee City was 
 assessed at $142,520,116. Applying the ratio of 52.07$ 
 gives a value for the city real estate of $273,708,692, and 
 applying to the assessed value of real estate outside of the 
 city, to-wit, $31,057,158, the ratio of 42.84$ gives a value 
 of $72,495,700 for real estate in Milwaukee County outside 
 of the city, or a total valuation for the real estate of 
 Milwaukee County of $346,204,392. The assessed value 
 of all real estate in Milwaukee County for 1903 was $173,- 
 577,574, which is 50$ of the true value of all of the real 
 estate in the county as thus figured. 
 
 To test the accuracy of these results the committee in- 
 stituted certain independent lines of inquiry. The Ameri- 
 can Appraisal Company, a corporation of this state, of 
 which Mr. E. IT. Bottum of Milwaukee is president, and 
 which has annually appraised property of the value of many 
 millions of dollars, was employed to appraise 463 descrip- 
 tions in the City of Milwaukee representing all classes of 
 real estate and all parts of the city. The total valuation 
 placed upon the 463 descriptions by the Appraisal Com- 
 pany was $3,664,488.16, and the assessed value of the 
 same descriptions for the year 1903 was $1,926,420, from 
 which it would appear that the ratio of assessed to true 
 value used in the assessment rolls of 1903 was 52.57$. 
 
 Mr. Brown, until recently and for a period of nine years 
 Tax Commissioner of the City of Milwaukee, a former 
 mayor and life long resident of the city, and whose ability 
 to make a just appraisal we believe to be unexcelled, was 
 also asked to appraise these same descriptions. The re- 
 sult of his work showed a valuation of $3,829,857 as against 
 
61 
 
 the $3,664,448.16 of the Appraisal Company, and the ratio 
 between Mr. Brown’s valuation and the 1903 assessment 
 was 50.03$ as compared with 52.57$ based on the figures 
 of the American Appraisal Company. 
 
 One other test of the ratio used in making the assess- 
 ment roll of 1903 in the City of Milwaukee, although per- 
 haps not as conclusive as the foregoing, may be mentioned. 
 The Chicago, Milwaukeee and St. Paul Railway Company 
 had its land values in the City of Milwaukee appraised for 
 its report of physical values which has been submitted to 
 this board. 
 
 Here is a block owned by the Railroad Company, which, 
 has a certain number of square feet, but is not assessed; 
 and here is a piece of similar property not owned by the 
 Railroad Company which is locally assessed. 
 
 From a consideration of the assessed property and its area 
 a hypothetical “assessed value” was obtained for the railroad 
 land which is not subject to local assessment. 
 
 Chairman Gilson : Explain the method whereby you ar- 
 
 rived at the area of adjoining lands. 
 
 Mr. Dudley: They were lots, and we could easily get 
 
 at it. 
 
 Chairman Gilson : You would take the lots fronting on 
 
 your land, or take entire blocks adjacent? 
 
 Mr. Dudley: I don’t know but Mr. Brown can answer 
 
 that better than I can ; but I have the work right here, I 
 think. Here it is. For instance here is a description of 
 our property, and the area has been figured out, and below 
 that is a list of the tracts with which that has been com- 
 pared in this manner: We add the assessed values, which 
 
 amount to $16,500; and the number of square feet assessed 
 
62 
 
 was 18,000. This gave an average assessed value per square 
 foot of $.9166. Multiplying that by the area of our prop- 
 erty, which was similar and adjacent to the assessed property, 
 gives what we assumed would be the valuation which would 
 have been put upon our property had it been assessable. 
 That is rather a back-handed way of working out the ratio; 
 but we were curious to see what our assessment would have 
 been had we been assessed as other property adjoining us. 
 In that manner we found a ratio of 47.29$ between the 
 hypothetical assessment and our appraised value. 
 
 The value of this company’s lands in the City 
 of Milwaukee exclusive of improvements was found 
 to be $5,395,666. These lands were, of course, ex- 
 empt from local taxation and are not valued on 
 the assessment rolls, but it was found that had 
 these lands been assessed for the year 1903, as an equal 
 area of similar adjoining properties was assessed, our value 
 would have been $2,551,395, which is 47.29$ of the true 
 value fixed by the company and reported to this board. 
 
 The best evidence we have to submit indicates that the real 
 estate of Milwaukee County as a whole was assessed for 
 1903, at about 50$ of its actual value and that the county 
 outside of the city was assessed at 42.84$. 
 
 Chairman Gilson : Our object was to furnish a larger 
 
 field of data than would be given if conveyances made and 
 recorded between September 1st of one and September 1st 
 of another year were given. 
 
 Mr. Dudley: I cannot see any objection to having the 
 
 larger data, the data of sixteen months instead of twelve, 
 if it were uniform; but a scrutiny of the reports you ask 
 shows that the registers did not regard the law, nor did they 
 regard the commission’s circular. 
 
63 
 
 Mr. Haugen : The last section of the chapter provides 
 
 that each Register of Deeds shall make and transmit such 
 further information recorded in his county as the Commis- 
 sioner of Taxation may request, 
 
 Mr. Dudley: I don’t believe that would authorize you 
 
 to use 16 months for a year. 
 
 Mr. Haugen : But it is in addition. 
 
 Mr. Dudley: You haven’t asked for it in that way, have 
 you ? I don’t think that is material ; only I thought it would 
 introduce an element of lack of uniformity. The Register 
 of Deeds use the year from September 1st to September 1st. 
 
 Chairman Gilson: It wouldn’t impair the value of the 
 
 statistics, except to give a smaller data than otherwise would 
 be obtained. 
 
 Mr. Dudley: As I say, I don’t see any objection to using 
 the 16 months period rather than the 12 months. 
 
 Mr. Bowers : The value to be attached to the statistics is 
 
 undoubtedly in the discretion of the board. 
 
 Mr. Haugen: Some of the Registers, in making reports 
 
 under the former statutes include all conveyances recorded 
 during the year, and some of them were ten years of age. 
 
 Mr. Dudley: I think our investigation has shown, what- 
 
 ever your instructions and whatever the law, that the reports 
 are valueless. 
 
 We have not been able to apply the same tests to the state 
 outside of Milwaukee County but something has been done 
 in two of the adjoining counties, namely, Ozaukee and 
 Racine, where the unreliability of the reports of Registers 
 of Deeds is still further demonstrated. Let me first read a 
 portion of the law under which the Register of Deeds acts : — 
 
 “Each register of deeds shall annually make and trans- 
 
64 
 
 mit to the Secretary of State on or before the 15th day of 
 September a statement in tabular form of all conveyance of 
 real estate, including executory contracts for the sale of 
 lands, made and recorded in his county during the year 
 ending on the first day of said month which appear to have 
 been made under ordinary conditions in the usual course of 
 business for a consideration expressed wholly in money.” 
 
 My attention has been directed to a circular issued by 
 the State Tax Commission dated June 19th, 1903, addressed 
 to the Registers of Deeds and requesting them to include in 
 their reports all proper conveyances dated after April 30, 
 1902, and before September 1, 1903. I submit that these 
 instructions are repugnant to the statute. The statute con- 
 templates that no conveyance shall be reported that was not 
 made and recorded between September 1, 1902, and Septem- 
 ber 1, 1903, while the instructions are to include certain 
 conveyances made not only during that period but also dur- 
 ing the period from April 30, 1902, to September 1, 1902. 
 It seems quite possible that as a result of these instructions 
 conveyances during four months of 1902 were included in 
 the 1903 report of the registers as well as in their 1902 
 report. 
 
 But a scrutiny of the returns from Ozaukee County shows 
 that the register regarded neither the law nor the commis- 
 sion’s instructions in his report ; for of the 141 deeds which 
 he reported 24 were both made and recorded prior to Sep- 
 tember 1, 1902. The law requires that only deeds be re- 
 ported where the consideration is expressed wholly in money 
 but of the remaining 117 deeds (after deducting the 24 
 which were made and recorded prior to September 1, 1902) 
 21 were subject to encumbrances which the grantees accord- 
 ing to the terms of the deeds assumed. The consideration 
 in these 21 deeds as given by the Register of Deeds is 
 
65 
 
 $71,112.50; but the actual consideration, that is the con- 
 sideration paid for the equity plus the encumbrances as- 
 sumed, was $102,467.50. The assessed valuation of these 
 21 pieces for 1902, was $52,230. We have not obtained 
 their assessment for 1903. Eleven other sales in this county 
 were reported where the consideration was not expressed 
 wholly in money and where the real consideration could not 
 be determined from an examination of the deed itself. These 
 were cases where property was conveyed for a certain sum 
 subject to dower rights, etc. In one of the deeds reported 
 the sale price is compared with the assessed value of a dif- 
 ferent description. 
 
 Mr. Curtis : What do you argue from that last mentioned 
 state of facts ? 
 
 Mr. Dudley : I argue that no correct conclusion can be 
 
 drawn from the register’s report without submitting it to 
 a test of accuracy. 
 
 Mr. Bowers : In the same county weren’t there other, 
 
 numerous, deeds where the expressed consideration was way 
 beyond the assessed value ? Is it to be supposed that the 
 assessor of this particular county was assessing one or two 
 tracts of land that way, and not generally ? 
 
 Mr. Haugen: You have to go to the individual assess- 
 
 ment district, if you were going to apply the same rule to 
 different assessments ; because one might assess full value, 
 and the other might not. 
 
 Mr. Dudley: We have taken the county as a district. 
 
 Such an examination as this shows, we think, the abso- 
 lute folly of relying upon the returns of Registers of Deeds 
 without submitting their reports to a most thorough revision. 
 But a consideration of the report in this county gives rise 
 
66 
 
 to another thought. The Tax Commission has made stren- 
 uous efforts to have the local assessors place the full value 
 of property upon their assessment rolls and for a determi- 
 nation of true value emphasis has been placed upon the rec- 
 ord of sales. An assessor who places upon property a value 
 less than that for which it was recently sold in the ordinary 
 course of trade can hardly assert that his under-valuation 
 was due to ignorance, and his attention has recently been re- 
 peatedly and emphatically called to the sales records as a 
 means of ascertaining values. 
 
 But the very fact that the record of sales is being re- 
 sorted to by this board and by the local assessors has made 
 real estate men reluctant to put on record the true value of 
 property transferred lest it might be used as a valuation for 
 tax purposes. It is not surprising, therefore, to find in 
 Ozaukee County that out of 117 deeds 20 show considera- 
 tions below assessed value, the aggregate consideration of 
 the 20 deeds being $20,124, and the aggregate assessment be- 
 ing $24,180. It seems incredible that any rational man can 
 suppose that of 117 transfers reported to have been made 
 in the ordinary course of business for a consideration ex- 
 pressed wholly in money that more than one out of every 
 six were assessed for more than their true value. Can anyone 
 doubt that the consideration in these deeds was fixed to 
 deceive the assessor ? Is it not reasonable to suppose that 
 the consideration in these deeds was fixed not to show the true 
 value of the property transferred but to prepare the prem- 
 ises for the erroneous conclusion that the property was as- 
 sessed at its full value ? But further than this, 10 other 
 descriptions of the 117, or about one-eleventh, show that 
 the properties v r ere sold for exactly the figure at v'hich they 
 were assessed the previous year. 
 
67 
 
 We believe that this scrutiny of the records of Ozaukee 
 County shows that a large number of the deeds reported 
 should have been omitted from the register’s returns and 
 that a large number of the remaining ones show considera- 
 tions placed in the deeds for the very purpose of producing 
 errors in the conclusions which were intended to be drawn 
 from them. What the actual value was which each of the 
 parties to these transactions placed upon his property we 
 do not know for we have not been able as in Milwaukee 
 County to interview the parties. But if we take the 21 
 deeds which were reported but which investigation showed 
 were made subject to mortgage and add to the considera- 
 tion the amount of encumbrances shown by the deeds them- 
 selves we find a total value of the 21 descriptions of $102,- 
 467.50, and the assessment of those descriptions for 1902, 
 was $52,230, which gives a ratio of 50$. 
 
 Mr. Curtis : How far does that ratio vary from the ratio 
 
 of those that you found suitable; that is, free from objec- 
 tion. 
 
 Mr. Dudley: I haven’t got the total. In getting at the 
 
 ratio of 50$ we have not been able to find out how many 
 are free from objection, because we have not been able to 
 interview the parties. In about one-eleventh of the deeds 
 the consideration was exactly the assessed value. 
 
 Mr. Curtis: You have made no generalization from any 
 
 of the data ? 
 
 Mr. Dudley: Ho, sir, except as stated. I thought in 
 
 those deeds that were made subject to mortgage there was 
 probably less “doctoring” than in the others. 
 
 Chairman Gilson : Can you assume the mortgages should 
 
 be added to the consideration expressed in the deed? That 
 is, where the mortgage is to be assumed — say property is 
 
68 
 
 worth $5,000, and there is a mortgage of $2,500, does it 
 follow that the consideration may not be stated “Five Thous- 
 and Dollars” as well as “Twenty-five Hundred Dollars.” 
 
 Mr. Dudley : If it read, “This deed is given for a con- 
 
 sideration of Five Thousand Dollars,” and then in a subse- 
 quent clause, “This deed is subject to a mortgage of Twenty- 
 five Hundred Dollars,” and the register reported “$5,000”, 
 his report would not indicate the value of the property. 
 But if I add the twenty-five hundred, the sum might show 
 the value. 
 
 Mr. Bowers : Makes the consideration $7,500. 
 
 Mr. Curtis: Don’t the scriveners who are usually or 
 often employed in the preparation of deeds of conveyance 
 recite in the deed of conveyance, in such cases as you now 
 speak of, the whole consideration ; notwithstanding the fact 
 that it is also in the conveyance that it is made subject to cer- 
 tain incumbrances. In other words, a conveyance of a prop- 
 erty really of the value of $5,000, subject to an incumbrance 
 of $2,500, notwithstanding the fact it is subject to such in- 
 cumbrance, and the grantee takes it subject to such incum- 
 brance, and, if you please, agrees to pay it all, that the 
 scrivener will write in, however, as the consideration for 
 the conveyance in the agreement the actual value of the 
 property, to-wit : $5,000 ? 
 
 Mr. Dudley : That is, the equity is worth $2,500 ; sub- 
 
 ject to a $2,500 mortgage; but instead of putting in the 
 value of the equity he puts in $5,000 ? 
 
 Mr. Curtis : Yes. 
 
 Mr. Dudley: My experience has been limited; but so 
 
 far as it goes, it is the other way. 
 
 Mr. Curtis : Perhaps that would be the most correct way, 
 
69 
 
 but isn’t it a fact that scriveners would do both ways in 
 writing out deeds ? 
 
 Mr. Dudley : They could do both ways. 
 
 Mr. Peck: I think the general rule is to make the con- 
 
 sideration aside from the mortgage. 
 
 Mr. Curtis : Let the consideration represent the equity ? 
 
 Mr. Peck: Yes. 
 
 Mr. Bowers : That is the import of the face of the paper. 
 
 Mr. Peck: I can conceive that the document might 
 
 state “Five Thousand dollars,” and provide for assuming a 
 $2,500 mortgage, and the payment of $2,500 in cash. 
 
 Chairman Gilson : It might be good ground for exclud- 
 
 ing those conveyances from consideration. They might not 
 furnish any basis for confirmative conclusions. 
 
 Mr. Peck: They are not to be reported, I should say, 
 
 under the general law. 
 
 Mr. Curtis : I agree they are suspicious enough to be 
 
 excluded from computation ; but if included it doesn’t neces- 
 sarily follow we can safely assume the recital of the con- 
 sideration represented the equity only. 
 
 Mr. Dudley : Perhaps Mr. Brown has some concrete cases 
 there which would show exactly what the situation was. 
 
 Chairman Gilson : Concrete cases can not amount to 
 
 much in the consideration of questions of this kind. 
 
 Mr. Thos. IT. Brown: The language of the deed might 
 
 make some difference. (Reading.) “Except a mortgage 
 to John Burton of two thousand dollars, of which eight 
 hundred has been paid.” “Except a mortgage of $1,100, 
 with interest thereon, which the second party assumes to 
 pay as a part of the purchase money.” 
 
70 
 
 Mr. Haugen : Is that a part of the purchase price set 
 forth: Is that to be read as a part of the purchase price 
 
 mentioned; or in addition to the purchase price? 
 
 Mr. Brown : I shouldn’t read it that way. 
 
 Mr. Haugen : It says “part of the purchase money.” 
 
 Mr. Curtis : I think there will be a pretty general agree- 
 
 ment that cases of that kind ought to he excluded from con- 
 sideration. 
 
 Mr. Bowers: This recital of consideration in the initial 
 part of the deed is almost universally accompanied by ac- 
 knowledgment of receipt. How is the grantor bound to 
 acknowledge the receipt of $10,000, when he has only got 
 $7,500, and $2,500 is equity, paid on the note ? I shouldn’t 
 think that would be true, in the minds of careful lawyers. 
 
 Mr. Baldwin : In case of failure of title, the consider- 
 
 ation might be important. 
 
 Mr. Dudley: In this county we get from the Register 
 
 of Deeds Reports a ratio of 79$. We think 50$ is nearer 
 the truth. 
 
 In Racine County the Register of Deeds reported 432 
 sales having the aggregate consideration of $905,855, and 
 the aggregate assessed value of $657,285, producing a ratio 
 of 72.56$. Of these sales 28 had no place in the Register’s 
 report, as they were both made and recorded prior to Sep- 
 tember 1, 1902. There were 51 deeds reported with a 
 consideration of $144,340 and an assessed value of $115,- 
 065, which indicated that the property described in these 
 51 deeds was assesssed at 80$ of true value, but investiga- 
 tion showed that each of the 51 deeds was made subject to 
 a mortgage, and adding to the reported consideration (which 
 did not include the value of the mortgages assumed) the 
 
71 
 
 amount of the mortgages would give an actual value of the 
 property of $225,015, which, compared with the assessed 
 values of the property, produces a ratio of 51$ as compared 
 with the 80$ derived from the incorrect report of the Beg- 
 ister of Deeds. 
 
 In this county there were 12 instances in which the con- 
 sideration in the deed was exactly the assessed value and 
 12 instances in which the consideration was less than as- 
 sessed value, and there are 27 other sales where the consid- 
 erations are not expressed wholly in money, having been 
 made subject to conditions which can not be valued in 
 money but which must have materially affected the selling 
 price. 
 
 Before leaving Bacine County it may be interesting to 
 note that the total assessed value of all property in that 
 county for 1902 was $32,212,568, while the total assessed 
 value for 1903 was $31,508,477, showing that although 
 there is now a supervisor of assessment whose duty it is to 
 bring about a full assessment, there was an actual loss in 
 the assessment of that county of $704,091. 
 
 The committee has some evidence as to the ratio of as- 
 sessment employed in Brown, Oconto, Outagamie, Shawano, 
 Winnebago, Wood and Marinette Counties. This consists 
 of testimony given by persons familiar with those counties 
 who have acted as members of boards appointed by the Cir- 
 cuit Courts to equalize valuations between taxing districts 
 of their respective counties. The sum of the actual values 
 of real estate for 1903 placed by these gentlemen upon their 
 counties was $175,344,671, while the assessed values of 
 the same counties for 1903 was $131,907,893, giving an 
 average assessment in those counties of 75$ of true value. 
 We submit these figures as to the eight counties for what 
 
72 
 
 they may be worth. We believe they show too high a ratio. 
 They were based upon calculations that were not nearly so 
 far reaching as those which we were enabled to make for the 
 City and County of Milwaukee. Investigations outside of 
 Milwaukee have necessarily been limited, but we believe that 
 enough has been done to show that the reports of the Regis- 
 ters of Deeds can not be accepted with further scrutiny. It is 
 not sufficient to eliminate those sales which on the face of 
 the return should have been omitted. An examination of 
 the deeds themselves is necessary, and further than that 
 parties familiar with the transactions should be interviewed. 
 Our investigation all tends to show that the ratio derived 
 from the returns of the Registers of Deeds is too high and 
 hence the true value of the general property of the state de- 
 termined by such ratio does not exceed the assessed value 
 as much as it ought. 
 
 But we have had the value of the real estate outside of 
 Milwaukee County computed on the basis of the Registers 
 of Deeds’ returns for the last year. This work was done by 
 Mr. Polleys, of the Omaha Road, who can give the details of 
 his work. Briefly, Mr. Polleys first took four or five coun- 
 ties and worked out their values by separate taxing districts. 
 He then ascertained their values considering the county as 
 a unit. The results were so nearly alike that Mr. Polleys 
 concluded that he would be substantially correct if the 
 county were used as a unit instead of the individual dis- 
 tricts, thus enabling him to deal with seventy territorial 
 units instead of some 1,300 or 1,400, and of course greatly 
 abridging his work. The result of Mr. Polleys’ computa- 
 tions give an actual value of real estate outside of Milwaukee 
 County of $1,312,549,821, but this we regard as too low a 
 valuation for the reason that it is based upon the returns of 
 
73 
 
 the Registers of Deeds which our investigations show give 
 too high a ratio. 
 
 Mr. Curtis : That is based on sales reported in the year 
 
 1903? 
 
 Mr. Dudley: Yes; one year’s basis; compared with the 
 
 assessment roll of 1902. 
 
 Mr. Curtis: But the ratio applied to the local assess- 
 
 ment of 1903. 
 
 Mr. Dudley: No; 1902. He has used the Board’s 
 
 method, except that he used one year as a basis ; and with 
 this further exception; after determining that there was no 
 practical difference whether he took each taxing district or 
 an entire county as a unit, he took the county as a unit. 
 
 This Committee is not prepared to demonstrate that the 
 real estate of Wisconsin is worth any particular figure, and 
 in the nature of things such a demonstration is impossible. 
 The Commission is better equipped for the work and it 
 may be has already brought to light values which have not 
 been discovered by the companies. But if we were asked to 
 place a valuation upon the real estate of Wisconsin based 
 upon our investigations, I think we might fairly figure it 
 as follows: 
 
 Bor the city of Milwaukee I should apply to the assessed 
 valuation of the real estate, $142,570,116, the ratio of 
 52.07$, which would give a valuation of $273,708,692. 
 This is the ratio obtained by comparing the considerations 
 in those deeds which were left after revision of the report of 
 the Register of Deeds with the assessment of 1903 of the 
 same properties. 
 
 To the real estate of Milwaukee County outside of the 
 city I would give a valuation obtained by applying 42.84$ 
 
74 
 
 to the real estate assessment of 1903 ($31,057,058), which 
 would give $72,495,700 for actual value. This gives to the 
 real estate of Milwaukee County a valuation of $346,204,- 
 392, which is almost exactly twice the total assessed value of 
 the real estate of the county. 
 
 The real estate outside of Milwaukee County was as- 
 sessed for 1903 at $927,336,471. The figures obtained by 
 Mr. Polleys were $1,312,549,821. The assessment was 70$ 
 of Mr. Policy’s figures, hut Mr. Polley’s figures, we think, 
 are much too low*, because he has dealt with the assessment 
 roll of 1902 and with the figures of the registers which 
 give ratios which are too high. We have the testimony of 
 certain well informed gentlemen indicating that the average 
 assessment of eight counties is at 75$; we believe that the 
 best existing evidence shows that Milwaukee County as a 
 whole is assessed at 50$ and that the county outside the 
 city ig assessed at 42.84$, and from such investigation as 
 has been been made in Ozaukee and Racine Counties we 
 believe that the assessment of real estate is about 50$. If 
 from such data we assume that the real estate outside of 
 Milwaukee County was assessed on the average at 63$, the 
 true value of real estate outside of Milwaukee County would 
 be $1,471,962,652. I do not believe that this figure is un- 
 reasonable. It exceeds Mr. Polley’s figures by $159,000,- 
 000, but w r e should expect Mr. Polley’s method to produce 
 too low a figure. My estimate of the true value in 1903 of 
 the real estate in Wisconsin is the sum of the figures given 
 for Milwaukee County, namely, $346,204,392, and that 
 just given for the state outside of Milwaukee County, which 
 make a total of $1,818,167,044. 
 
 The personal property of the state was assessed for the 
 year 1903 at $238,031,134. If one w T ere to judge the in- 
 
75 
 
 chistrial development, the comforts of living enjoyed, or the 
 degree of civilization attained, by the value of their per- 
 sonal property as shown in the assessment rolls, the con- 
 clusion would inevitably he that the people of Wisconsin 
 are still living in the middle ages. The assessment of per- 
 sonal property in this state is a mere farce. Picture an 
 assessor in the City of Milwaukee in the performance of 
 his duty. His work of valuing property must he done in 
 two months. He is compensated at the rate of $60 per 
 month. In the performance of his duty he must assess thb 
 value of the stock of a wholesale dry goods store. From 
 this he passes to the assessment of a packing house. Hext 
 he is called upon to value the diamonds, watches, silver- 
 ware, etc., found in a jewelry store; his omniscience is next 
 to he applied in determining the value of the stock of a 
 wholesale hardware concern, and in like manner he is re- 
 quired to value all classes of personal property. The per- 
 formance of such a duty is a sheer impossibility. I under- 
 stand that the assessment of such a concern as the Grimbel 
 Pros.’ store in the City of Milwaukee usually occupies 
 about thirty minutes. It is absurd to say that there is such 
 a thing as an assessment of personal property. As a matter 
 of fact what is called the personal property assessment might 
 better be defined as voluntary concessions made by property 
 owners. 
 
 The value of the stocks in Wisconsin of merchants and 
 manufacturers reported to a certain commercial agency in 
 1903 was $179,820,902, which is more than 75^ of the en- 
 tire personal property assessment. In its October valuation 
 this Commission increased the assessed value from $238,- 
 081,134 to $443,667,336, and used as a valuation of the 
 real estate of the state $1,309,504,464; that is, the personal 
 property under the October valuation was fixed at about 
 
34$ of the real estate valuation. If the same per cent of 
 the $1,818,167,044 (which is our estimate of the value of 
 the real estate) were taken, it would give for our estimated 
 value of the personal property $618,176,795, but 34$ we 
 regard as too low. The assessment rolls give no clue as to 
 the value of personal property, but if we seek the views of 
 experts and economists we find a practical unanimity of 
 opinion that the value of personal property in such a com- 
 monwealth as Wisconsin exceeds that of real property. 
 
 It would seem to be more than conservative if in esti- 
 mating the value of the personal property of the state such 
 value should be fixed at 50$ of the estimated value of the 
 real property, and on that basis it would appear reasonable 
 to fix the personal property valuation for 1903 at $909,- 
 083,522, and this added to the estimate heretofore given of 
 the real estate would make a total valuation of the general 
 property of the state of $2,727,250,566, to be used as the 
 divisor in ascertaining the average rate of taxation. And 
 this conclusion seems to be corroborated by the fact that 
 the average rate thus produced will probably not materially 
 differ from the average rate in adjoining states. 
 
 The people of Wisconsin are not a tax ridden people. 
 We do not believe that we are taxed more heavily than our 
 neighbors of other states, and many papers of the state 
 have recently been tireless in their efforts to show how light 
 is the burden of taxation under the administration of such 
 a man as the present Governor. What the aggregate is of 
 the state, county and local taxes for the year 1903 levied on 
 general property we do not yet know, but assuming it to be 
 $20,000,000, the average rate on my estimated valuation of 
 the general property would be about 7 mills. Compare this 
 rate with that paid in the State of Iowa. The average rate 
 
77 
 
 of taxation in that state is about 32 mills, but, this rate is 
 applied to one-fourth the assessed value. From voluminous 
 testimony presented to the Executive Council of that state 
 in July, 1902, by county auditors and others the assessed 
 value of the state appeared to be about 80$ of true value. 
 The rate of 32 mills would, therefore, be applicable to one- 
 fourth of 80$ or 20$ of actual value; and to apply 32 mills 
 to 20$ of full value is the same as applying a rate of six 
 and two-fifths mills to full value. 
 
 Statement of W. W. Baldwin on The Value of the 
 Peesonal Peopeety in Wisconsin Subject 
 to Taxation. 
 
 2 o’clock p. m. 
 
 Mr. Chairman and Members of the Commission: 
 
 I received your circular letter, asking if I desired to be 
 present at the preliminary hearing at which will be consid- 
 ered the question of the valuation of the railroad property in 
 Wisconsin belonging to the Burlington Company, and wish 
 to say that I desire to be present at that hearing. 
 
 That valuation, when it is made, will not be an estimate 
 of value upon the property of the Burlington Company in 
 Wisconsin, for the purpose of selling it, nor any part of the 
 securities which represent it, nor for obtaining credit upon 
 it, nor for estimating or illustrating the wealth of the cor- 
 poration. It will be the valuation of the Commission alone, 
 and made by it for a single purpose ; and that purpose is to 
 affix to it a certain tax rate. That rate is now unknown. It is 
 not the same rate that is being paid, nor that will be 
 paid, by any other individual in the State of Wisconsin 
 upon his property; nor by any other corporation in Wiscon- 
 sin upon its property, except it be a railway company; nor 
 will it be the same rate that is being paid by the owners of 
 other property in the counties and in the taxing districts in 
 which the property of the Burlington Company in the State 
 of Wisconsin is situated. It will be the Commission’s own 
 
78 
 
 rate as the valuation of the railroad is the Commission’s own, 
 subject only to the mandate of the constitution that “Tax- 
 ation shall be uniform.” 
 
 In its first report, that of 1901, the Commission formu- 
 lated its own view of the law that was to accomplish this 
 constitutional duty of uniformity and equality of taxation 
 in Wisconsin in these words : “A law that will equally dis- 
 
 tribute the public burden among all the citizens of the state 
 according to their property or ability to pay.” 
 
 Subsequently, in the same report, you stated more at 
 length the general principle which should guide in consider- 
 ing this question to-day, in these words: 
 
 “The laws of the states generally provide for the assess- 
 ment of the property of individuals at the fair or market 
 value, but this is not done. The valuation of railroad prop- 
 erty at full value and other kinds at one-half value or less, 
 when the same rate of taxation is laid on both, is so grossly 
 inequitable and unjust that the constant effort and inclina- 
 tion will be to bring the former down to the common level or 
 supposed equality. In the absence of reliable data, the 
 levelling process is a mere estimate. The assessed value of 
 property other than railroads is usually the only statistics 
 available to state boards, and is little or no guide to the true 
 value. To aid the boards in forming judgment as to relative 
 value, resort is sometimes had to affidavits or evidence of 
 witnesses who give opinions of the value of property in differ- 
 ent parts of the state, which, instead of giving light on the 
 question, are generally as unreliable as assessors’ figures, and 
 tend to mislead and confuse. Where such conditions are 
 found, boards are confronted with the duty of ascertaining 
 the value of all property in the state and the value of rail- 
 roads, of making comparisons, and then of assessing or 
 equalizing the railroad property.” 
 
 The duty, then, of this board, unquestioned and univer- 
 sally acknowledged, is to establish such a tax rate for rail- 
 road property as shall make the tax burden rest upon the 
 
79 
 
 owners of that property in this state the same as it rests 
 upon the shoulders of the owners of all the other property. 
 
 I can form no judgment, gentlemen, as to how you were 
 impressed with the evidence that was presented to you this 
 morning by Mr. Brown and others. It certainly was valu- 
 able and impressive evidence as to land values in Wisconsin, 
 and proof that we are trying in good faith to co-operate with 
 the Board, in ascertaining the value of the general property 
 of this state. 
 
 I do not understand that anything which this Commission 
 has yet done or announced at any time or place is incon- 
 sistent with the view that this whole subject is to-day before 
 you unsettled and for consideration in its broadest aspect. 
 I understand that your minds are still open, and absolutely 
 without prejudice or predetermination, upon the broad ques- 
 tion of what average rate ought to be fixed, in order to se- 
 cure uniformity and equality in tax burdens as between the 
 owners of railroads and the owners of other forms of prop- 
 erty. 
 
 HOW RAILROADS WILL BE VALUED. 
 
 [Regarding the valuation of the railroad property there 
 can hardly be any doubt in the mind of any intelligent 
 person that as that subject is developed and discussed and 
 conclusions are reached, its full value will be found and 
 declared. We all know that. If it is within the wit of 
 man to devise plans for getting information and applying in- 
 formation so as to bring out every element of value, which 
 have not been devised and applied to the question of the 
 valuation of railroad property, I do not know what those 
 plans are. klot only, as Mr. Crandon has said, every bolt 
 and screw and every scrap of paper — all the physical features 
 
80 
 
 which make a railroad, are produced in fullest detail and 
 submitted to your scrutiny, and to that of critics and en- 
 gineers ; not only are all “franchise” features to be estimated, 
 but beyond all that is the very wide field where it is possible 
 to go into the question of earnings of the companies and of 
 market quotations upon their stocks and bonds, and many 
 purely speculative elements. 
 
 We may fairly assume, I think, that it is the present pur- 
 pose and intention of this Board to take the full market and 
 complete actual value of every railroad and of every scrap 
 and fragment and item of value in the property of every 
 railroad company, whether actually or constructively in the 
 state, and whether omitted from the rolls or not, and apply 
 to such complete valuations the tax rate which they will es- 
 tablish. There will be no such thing as “undervaluation” 
 nor “omitted property” in the case of the railroads. Does 
 not the mandate of the Constitution that taxation shall be 
 uniform require in the case of the general property of the 
 state, real and personal, that there shall likewise be no such 
 thins: as either omission or undervaluation ? How else can 
 there be equality and uniformity ? Do not the principles of 
 sound morality and evenhanded justice require this ? Shall 
 not this Board, in that broad discretion which belongs to it, 
 under the Constitutional guaranty, see to it that in the gen- 
 eral property there shall not be, manifestly, either property 
 omitted from taxation nor property undervalued in the as- 
 sessment ? I hope to point out a way in which this may, at 
 least partially, be accomplished in the case of personal prop- 
 erty, both in the matter of habitual and intentional omission 
 and habitual and intentional undervaluation. 
 
81 
 
 RAILROAD VALUES AND GENERAL PROPERTY VALUES. 
 
 I do not approve the principle of taking market quota- 
 tions of stocks and bonds as the test of value of the property 
 of the company issuing them, nor of taking net earnings as 
 such test of value. But there is a clear line of distinction, 
 worth bearing in mind, between estimating values of land 
 and of goods and other personal property, at a specified date, 
 say on May 1, 1903, and when you come to the question of 
 using market quotations of corporate stocks and bonds and 
 the earning capacity of property, retaining a perfect liberty 
 to take prior years into consideration. The distinction to 
 he made is plain. A tract of land is sold in 1903. If you 
 know what it actually and truly sold for, that is the best 
 evidence in the world of its value in 1903. Many sales 
 were made in Wisconsin in the past year of lands, and lots, 
 and stocks of goods, and horses and other property. Those 
 actual sales and prices and the conclusions of value that are 
 to be drawn from them are the resultant of all the forces 
 and influences that make value — the thing we call “value.” 
 That is the value. But when we talk about sales of “securi- 
 ties” that have been issued by railroad corporations, we are 
 not talking about sales of railroads. We are talking about 
 an entirely different matter. Suppose there were no actual 
 sales of horses, nor sales of land, nor lots, hut that all the 
 lands, lots and horses were owned by corporations, and the 
 people who managed these corporations had issued in times 
 past certain securities upon them. The Northwestern and 
 the Milwaukee Companies are to-day operating properties 
 which, as we say, are “capitalized” for so much ; the stocks 
 and bonds outstanding for these companies have come down to 
 them as an inheritance of past years; and the stock market 
 
82 
 
 quotations that are announced are quotations, not of sales 
 of railroad property, but quotations of paper representatives 
 of the property, and subject to all sorts of peculiar influences 
 and conditions which may or may not show value. There 
 are highly speculative conditions and other matters that in- 
 volve questions of railroad strategy and of the control of 
 one road by another. Now, if you had similar conditions in 
 regard to land, and personal property, and if you were under- 
 taking to determine values from such conditions — if there 
 was a great auction or market for shares representing the 
 general property of the state, then I would not maintain 
 that you could dare to consider stock market quotations of 
 such shares for a single year only. You would, beyond all 
 question, go back into a series of years. Likewise, upon the 
 question of earnings, which are so susceptible to great 
 changes, depending upon prosperous or adverse business 
 conditions in the country at large, in successive years. 
 
 Under the law which defines your powers you are posi- 
 tively required to find the value, the true full value, of the 
 general property of Wisconsin on the first day of May, 1903, 
 which is not the same thing as its average full value for the 
 past seven years, or the past five years, or the past 
 three years. The performance of that plain duty ought 
 not it seems to me to be marred or hindered by the fact 
 which is equally plain and clear that it is inexact and mis- 
 leading and therefore impossible to accept stock market 
 quotations of the shares of a railroad company for any one 
 year, or the earnings of that railroad for any single year, as 
 proof of the value of the property of that company. 
 
 Such quotations do not prove value. If taken for a series 
 of years they throw some light upon value, while for a single 
 year they may wholly deceive as to value. 
 
83 
 
 The Sales Repoets as a Test of Land Values. 
 
 Allow me one word generally, upon the question of the 
 sales method of valuation of the landed property. I thor- 
 oughly sympathize with the feeling and wish of the commis- 
 sion to seek for some true and fair test of land value. I 
 sympathize with the hope of the commission to find that land 
 sales as reported to the Secretary of State are a fair indica- 
 tion of true value. If you had, in fact, the whole truth be- 
 fore you regarding these sales, and could accurately compare 
 them with the assessment, carrying out the full spirit of the 
 law which Mr. Dudley read, I am not in a position to find 
 fault with the theory. On the other hand, no one can fairly 
 criticise the commission if it should, upon evidence, modify 
 its view or hope as to the reliability of these reports of land 
 sales. As you say, Wisconsin is probably the only state 
 which has these statistics so fully, and so far as I know, this 
 is the first real opportunity, or occasion, when that theory, 
 so far as it is a theory, is put to the test. 
 
 If the Commission had made for itself the kind of in- 
 vestigation which has been disclosed by the evidence here 
 to-day, or any other careful investigation to test the sound- 
 ness of the conclusions drawn from these reports of sales, the 
 case would be different. But assuming that the evidence is 
 satisfactory; assuming that it is reliable; assuming that Mr. 
 Brown is competent, and that the examinations which he has 
 made are trustworthy, how can you possibly feel that you have 
 before you in these reports of land sales made to the Secre- 
 tary of State, a basis for determining values of land that will 
 do ? There are eighty thousand different land assessments 
 in the City of Milwaukee. During the year about eight thou- 
 sand sales were made in Milwaukee, and out of these sales, 
 
84 
 
 reports of eleven hundred sales were made to the Secretary 
 of State as being for money, and each showing in the deed 
 the real consideration. These eleven hundred sales, with the 
 considerations stated in the deeds and the assessments upon 
 the same tracts, have been accepted as genuine tests of value 
 and the percentage they indicate has been accepted and ap- 
 plied to the entire real estate assessment of Milwaukee. But 
 they are not genuine tests of value — not half of them. A 
 careful scrutiny discloses conclusively that in only three hun- 
 dred and thirty-six of these transactions do the deeds show 
 the true and real consideration of the sale ; all the others are 
 spurious, for the purpose used. 
 
 In Milwaukee County there are one hundred and twenty 
 thousand assessments, and an examination of all the sales 
 reported for the year in that county to the Secretary of State 
 shows that there were just five hundred and twelve deeds in 
 which the real and true consideration is stated in the deed. 
 Ho more. That is one to every two hundred and forty as- 
 sessments. 
 
 How, where do these facts bring us ? Is it in any way 
 misstating the proposition to put it in this way: You have 
 
 an assessment district in which are 240 land assessments, say 
 of $1,000 each, or a total assessment of $24-0,000. In that 
 district you find, during the year, just one sale. A lot as- 
 sessed at $100 has been sold for $500. Would any one feel 
 that, upon this evidence alone as to how assessors were as- 
 sessing property in that district, this entire assessment ought 
 to he multiplied by five and he made $1,200,000, instead of 
 $240,000 ? 
 
 Would it do to apply the same rule to the assessment of 
 personalty ? 
 
 Suppose a taxing district in which 240 horses are reported 
 
85 
 
 and assessed at $50 each on the average, or $12,000 in the 
 aggregate. Then, during the year, suppose you have evi- 
 dence of the sale of one horse for $100 which has been as- 
 sesssed for $20. Is that sufficient evidence that the assessors 
 are only assessing horses at one-fifth value, and would it 
 justify you in multiplying the assessment of horses by five 
 and making it $60,000, instead of $12,000, in that district? 
 
 Mr. Dudley: Suppose that was the only data you had on 
 
 sales, would you use it ? 
 
 Mr. Baldwin : Well, I would find some other if I could. 
 
 I would very much prefer the conclusions of value of your 
 Appraisal Company. I would place greater reliance upon 
 the judgment of the tax supervisors in the different counties. 
 
 Mr. Dudley: You would prefer to take that one reliable 
 
 sale rather than to take the one plus a certain number of 
 erroneous sales added to it, wouldn’t you ? 
 
 Mr. Baldwin : Yes, I would. But it seems to me that 
 
 the basis is too narrow. It is not sufficient to justify us in 
 reaching a conclusion upon that evidence alone. The dis- 
 closures made by Mr. Brown seem to prove beyond question 
 that the deeds, of which a memorandum is filed with, the 
 Secretary of State, do not, upon their face, show the real con- 
 sideration for the sale except in the case of about one sale 
 to every two hundred and forty assessments, which, to me as 
 a reasonable individual, does not appear to be a basis broad 
 enough upon which to make a land assessment for the entire 
 State of Wisconsin. There ought to he better evidence. 
 
 But the Commission has not strictly applied this method 
 to the assessment of personalty. On page 66 of 1901 report 
 you say: 
 
 “In their computations the Commission first calculated 
 the total value of the personal property, by taking the aver- 
 
86 
 
 age ratio of assessed valuation to actual value shown by real 
 estate in each assessment district (it was deemed a fair pre- 
 sumption that the assessor applied to personal property, or 
 that part of it discovered by him, the same ratio that he ap- 
 plied to real estate ), then adding the total assessment of per- 
 sonal property in each district for five years and taking an 
 average of that and applying it to the real estate ratio” 
 
 Now that amounts to this, as I would read it: Take an 
 
 assessment district in which there are 240 horses assessed 
 at $50 each, or in the aggregate $12,000. You do not find 
 what one horse has sold for and what it was assesssed for, 
 but you find what one lot sold for, or one farm sold for, in 
 that assessment district, and you say : “We find that a lot 
 
 assessed at $200 has been sold for $1,000, therefore we will 
 multiply the assessment of horses in that district by five.” 
 That is carrying the thing a step further, and does not ap- 
 peal to my judgment. The question whether in the mind of 
 each assessor in the state it was intended to make applica- 
 tion to all the personalty of the very same deduced ratio that 
 he applied to real estate, is a totally different question. Are 
 we justified in making so important a deduction as the as- 
 sessment of all the personalty in the State of Wisconsin de- 
 pend upon such a presumption ? x\re there not better 
 methods ? Are there not better tests ? Are there not sounder 
 rules by which we can be guided ? 
 
 In what I may say regarding the true method of con- 
 sidering the question of the value of all the personal property 
 in this state I shall try it differently, although you may con- 
 clude before I finish that the determination of the value of 
 real estate is an exact science, compared with finding the true 
 value of all the personalty. 
 
87 
 
 Personal Property Omissions and Undervaluations. 
 
 The Commission is seeking to establish a tax rate the 
 ultimate result of which will place the burden of taxation 
 in Wisconsin upon those who own the railroads the same 
 as it is being carried by those who own all the land, and all 
 the personalty of the state. This is being worked out through 
 the process, first, of ascertaining the full true value of all the 
 property subject to taxation, including, of course, all the 
 personal property. 
 
 Can we find such true value of all the property in this 
 state by omitting to see, or refusing to consider, the half of 
 it — either half? The proposition shocks our sense of fair- 
 ness and cannot be accepted unless the command of the Con- 
 stitution that taxation shall be uniform, is to be totally disre- 
 garded. 
 
 Speaking of this difficulty, the Commission, on page 65 of 
 its 1901 report, says: 
 
 “It has been stated by many economists and statisticians, 
 and generally accepted as truth by others, that taxable per- 
 sonal property probably exceeds in value the taxable real 
 property in all the older states and equals it in the newer 
 sections. The Tax Commission, while not prepared to dis- 
 prove this, has proceeded in its work upon the hypothesis 
 that the proposition has not been proven. In the practical 
 administration of tax laws at the present time it is apparent 
 that calculations must be confined to personalty that actually 
 finds its place on the tax rolls. The public burden falls al- 
 most exclusively upon the personalty found on the rolls and 
 on the real estate. Taxes are levied on such property, and 
 not on that which escapes. It is so everywhere and no less 
 in Wisconsin than in other states. Speculation as to how 
 much escapes will not make up the deficiency, nor can it be 
 contended that the evasion is ground for lessening the just 
 burdens on property that can be reached ” 
 
88 
 
 Now, suppose it was a practice with assessors in Wisconsin 
 in one year to assess only the odd-numbered sections of land, 
 and the odd-numbered lots; and in the next year to assess 
 the even-numbered sections, and even-numbered lots; and 
 suppose that such a practice was not so repugnant to the law 
 hut that it could be upheld. You have before you the ques- 
 tion of establishing a tax rate that shall rest upon railroad 
 property the same as it rests upon the general property of 
 the state. Would you ignore this practice ? Would you 
 simply take into consideration the real estate you find for 
 that year upon the tax roll ? No ; you would take into your 
 account all the real estate, whether undervalued or omitted 
 from assessment. In any taxing district if you found one 
 lot that was omitted, you would not hesitate to insist that that 
 lot should be considered. Why ? Because you are determin- 
 ing under the Constitution a broad question of equality in 
 taxation. You have before you, to he valued by yourselves 
 alone, a certain class of property. You are to fix a tax bur- 
 den upon that property: nobody else is to do that. Aside 
 from the fact that the owners of the real estate are also the 
 owners of the personalty, there is the further important fact 
 that they select those who list and assess their property. If 
 you would not allow wholesale omissions of land to pass 
 unheeded in considering what is the true value of all the 
 general property of the state, how can you do it with regard 
 to the personalty ? Suppose that assessors deliberately and 
 habitually omitted all personal property from assessment ? 
 This item appears to me to indicate such a tendency: Last 
 
 year there were 50,646 watches in the state, assessed at 
 $643,000 ; this year there are 5,513 watches, assessed at 
 $135,262. Perhaps we are approaching a condition where 
 all personalty is to he ignored. 
 
89 
 
 Mr. Curtis: You remember there has been a remarkable 
 
 change in the law in regard to the assessment of watches be- 
 tween 1903 and 1902. 
 
 Chairman Gilson: They are all exempt unless of the 
 
 value of fifty dollars or over; and of course it is difficult to 
 find a watch worth more than fifty dollars. In 1902 all 
 watches were assessed. 
 
 Mr. Baldwin: That is an explanation which escaped my 
 
 notice. Last year there were assessed seventy-three millions 
 of moneys and credits ; this year there are twenty-four mil- 
 lions. 
 
 Mr. Curtis : You are aware of a great change of the law 
 in that respect. 
 
 Mr. Baldwin : The change, as I understand it, was, that 
 
 where land is mortgaged, and the mortgage is assessed, the 
 value of the mortgage shall be deducted from the assessment 
 of the real estate. 
 
 Mr. Curtis : That is quite different from what the law 
 
 is. Mortgages are assessed as an interest in the real estate, 
 and do not appear as a personal property assessment. 
 
 Chairman Gilson : They are wholly eliminated from the 
 
 personal property assessment where they are upon taxable 
 real estate. There are a few mortgages on non-taxable real 
 estate where they would he on the personal property assess- 
 ment; otherwise all mortgages are assessed as part of the 
 interest in the real estate. 
 
 Mr. Baldwin: Are they supposed to appear in the real 
 
 estate assessment ? 
 
 Chairman Gilson: The real estate assessment is the same 
 
 as it was before. It appears as the equity of the mortgagor, 
 and the interest of the mortgagee. 
 
90 
 
 Mr. Baldwin : That is, through the operation of the law 
 
 this tendency to omit all personalty from the assessment is 
 being accelerated. 
 
 Chairman Gilson : The law amounts to a practical ex- 
 
 emption of mortgages as personal property. It is intended to 
 relieve the owner of the premises from double taxation. 
 
 Mr. Baldwin: Such an interpretation, I must admit, in- 
 
 creases the difficulty of forming a correct judgment as to the 
 true amount of moneys and credits which you ought to take 
 into consideration, hut that duty of forming a judgment re- 
 mains your duty notwithstanding the increased difficulty. 
 
 To bring out the point as to palpable and intended omis- 
 sions more clearly, let me ask this question : Are you willing 
 to carry the suggestions of omission from assessment one 
 more step? 
 
 Simply assume that, under suitable and appropriate legis- 
 lative enactments, combined with the deliberate and sys- 
 tematic action of the assessors, all the land and all the per- 
 sonalty are substantially dropped out of the assessments — 
 leaving nothing except your own assessment of the railroads 
 — and that you are then confronted with the duty, as now, of 
 levying upon railroad property an equal and uniform tax 
 rate, which will result, if I may again quote your own words, 
 “in equally distributing the public burden among all the 
 citizens of the state, according to their property or ability 
 to pay.” Such a condition is before you this very day, in 
 fact, as to two-thirds of all the personal property in Wis- 
 consin, and the wrong and injustice of it will appear more 
 and more clearly as the vast and rapid increases in wealth 
 take on personal property forms — in fact, they are changing 
 into forms of personalty more and more. 
 
91 
 
 So far as the property of the railroad companies is con- 
 cerned, what is then to become of their constitutional pro- 
 tection of equality and uniformity of taxation ? 
 
 The True Value of the Taxable Personal Property 
 of Wisconsin. 
 
 In a communication recently submitted by a committee 
 upon taxation of the business men’s association of the City 
 of Boston, they made this declaration : “The personal prop- 
 
 erty of both the city and the state which under the law is 
 subject to taxation, can not be less than twice the value of 
 the real estate. Upon this all writers agree.” I will not ask 
 this Commission to accept that principle, nor the principle 
 named by itself, that “taxable personal property probably 
 exceeds in value the taxable real property in all the older 
 states, and equals it in the newer sections.” But, I have often 
 observed that general principles of this character, based upon 
 generations of human experience and the judgment of inde- 
 pendent inquirers — such, for instance, as the Gresham Law 
 in finance — are oftentimes more to be relied upon than many 
 of these things we say we can prove specifically. I may not 
 be able to prove that the value of the personalty in this state 
 is equal to the value of the land, however, much I believe it. 
 Wisconsin is a great state. It is a great manufacturing state. 
 It has four hundred million dollars invested in manufac- 
 tories ; more than three times the capital in factories that 
 we have in the State of Iowa. The manufacturing indus- 
 tries of Wisconsin are growing wonderfully. It is in such 
 states that the proportion of personalty to realty is large. 
 It is to such states that this principle or rule that the value 
 of the personalty exceeds the value of the land may very 
 
92 
 
 properly apply. You have in Wisconsin over two hundred 
 million dollars of bank resources. The value of your agri- 
 cultural products for the single year 1900 was reported in 
 the census at over one hundred and sixty millions of dollars ; 
 the value of logs and timber products over fifty-seven mil- 
 lions; and the capital employed in manufactures three hun- 
 dred and thirty millions. Where do these vast amounts of 
 wealth and greatness appear in your personal property as- 
 sessment ? There are four items : “Leaf tobacco,” one mil- 
 
 lion, seven hundred and fifty thousand dollars ; “logs, timber, 
 ties, etc.,” twelve millions ; “bank stock,” twenty-two mil- 
 lions ; “moneys and credits,” twenty-four millions ; or about 
 fifty-nine millions. That is all. Among the sources of the 
 present material wealth of Wisconsin, are these hundreds 
 of millions in value and of all this taxable personalty I find 
 fifty-nine millions assessed. 
 
 But I am not asking that a valuation be made of this prop- 
 erty upon mere generalities. I am admonished, if admoni- 
 tion were necessary, by the suggestion of the Commission 
 that “Speculation as to how much personal property escapes 
 assessment wdll not make up the deficiency. ” If I can not 
 point out where it escapes, and how it escapes, I do not ask 
 the Commission to indulge in mere speculation upon this 
 subject. 
 
 The assessors returned a personalty assessment of 1903, 
 for the whole state, of two hundred and thirty-eight millions 
 of dollars. The Commission, in its October valuation, in- 
 creased that to four hundred and forty-three millions. That 
 we understand to be a purely tentative estimate and for an 
 adjustment of the state tax and having nothing to do with 
 your estimate of the total personalty which, together with 
 the real estate, is to constitute the “general property” sub- 
 
93 
 
 ject to taxation, from which you are to establish an average 
 rate to be applied to railroad valuations. That estimate, as 
 I said, is as yet entirely undetermined. To decide what it 
 ought to be is what this hearing is for. The assessors re- 
 turned personal property to the aggregate of two hundred 
 and thirty-eight millions and you raised it in October to 
 four hundred and forty-three millions. That amounts to 
 saying that, for the October purposes, you would regard the 
 state assessment of personal property, as of date May 1, 
 1903, to be equal to fifty-three per cent, of true value of the 
 personalty. In my opinion, based upon the best thought I 
 have been able to give the subject, it does not exceed thirty 
 per cent, of true value. I believe the Commission will be 
 guided by the facts. Some of the facts w T hich have influenced 
 my judgment have been furnished by the Commission itself. 
 That is simply a further acknowledgment of the debt which 
 the people of the state owe, and all those interested in this 
 question owe, to the work of the Commission. 
 
 Valuation of Peopekty of Estates of Decedents. 
 
 I ask to recall your attention to the investigation which you 
 made of the assessment of the property of decedents’ estates. 
 You investigated over eleven hundred estates, in seven dif- 
 ferent counties, and covering eight millions of property; and 
 those results are embodied in the table at page 128 of your 
 1901 report. This table shows that those estates had per- 
 sonal property with an appraised value of about eight mil- 
 lion dollars; and that out of that there was $248,000 prop- 
 erly exempt on account of debts, and $2,696,088 taken out on 
 account of “other exemptions,” so that there was left, prop- 
 erly subject to taxation, $5,023,860. This was assessed at 
 
94 
 
 $1,131,000 or twenty-five per cent, of appraised value. A 
 large portion of this total was “intangible” personalty — 
 stocks and bonds and cash. I have carefullv read and 
 
 c / 
 
 largely sympathize with, the views of the Commission about 
 how much of that intangible property should be cousidered 
 in estimating the true value of estates. Part of it might be 
 stock in a Wisconsin corporation, which, by law, is exempt 
 from taxation, as such. But, if you throw out every dollar 
 of the intangible property, you have an assessment upon the 
 remainder of only thirty per cent. Upon page 131 of the 
 Report, you say : “Including Milwaukee County but 
 
 omitting the one estate referred to, the ratio of appraised in- 
 tangible personalty to the whole personal appraisement is 
 about 91 per cent, and the ratio of the assessment of same 
 to the whole appraisement is 9 per cent., while the ratio of 
 appraised tangible personalty to the whole appraisement is 
 10 per cent., and of the assessment of same to the whole ap- 
 praisement is 3.5 per cent. ; or, making the comparison in 
 another way, we find that of the appraised intangible per- 
 sonalty (which is 90 per cent, of the whole) only 5.5 per 
 cent, was assessed, while of the appraised tangible personalty 
 (which is but 10 per cent, of the whole) almost SI per cent, 
 appears on the assessment rolls.” So that if you ignore every 
 dollar of intangible property that belongs to those estates, 
 you have only 30 per cent, of the actual tangible property, 
 after throwing out all exemptions of every character, upon 
 which there is any assessment for taxation. 
 
 One word in regard to appraisement of estates. It is un- 
 doubtedly true, as the Commission says: “The values set 
 
 by appraisers in the County Courts are quite conservative 
 and lower rather than higher than the prices which could be 
 obtained for the same property at private sale. Adminis- 
 
95 
 
 trators and executors quite generally desire a low appraise- 
 ment, so that when their final account is rendered there may 
 he no loss shown from inventoried prices, and appraisers, we 
 presume, are somewhat influenced by this desire of the ad- 
 ministrators and executors.” 
 
 That is true, and more, because in my experience there is 
 another motive much more powerful than that suggested by 
 the Commission, and that is this very tax feature. These 
 estates are in process of winding up, and the personal prop- 
 erty in the hands of executors on the first of May, each year, 
 ought to be subject to assessment. They may continue as 
 executors for years. It is my recollection that in the City 
 of Chicago many estates — for instance the Pullman estate — 
 turned out to be double the appraisement. That was largely 
 to avoid taxation. Those in charge of estates are governed 
 by the same kind of selfishness as other mortals. 
 
 We must all die and our estates be probated, if we have 
 any. Your investigation only covered thirteen hundred 
 estates, scattered through seven counties. But there is not 
 a reason on earth for thinking that a state-wide investigation 
 would not disclose similar facts. It amounts to this: Ex- 
 
 cluding every dollar of intangible property, and considering 
 tangible property only, the probating of every man’s estate 
 in Wisconsin will show that his personal property is only as- 
 sesssed for taxation at thirty per cent, of its appraised value, 
 which is decidedly less than the true value. 
 
 If that is true of his estate when he is dead, it is equally 
 true of his estate when he is living. Can you shut your 
 eyes to such evidence? If you believe upon facts like these, 
 that there is a systematic and universal method in force 
 among Wisconsin assessors, through which the tangible, vis- 
 ible, physical personal property of the state is assessed, as a 
 
96 
 
 whole, at not over thirty per cent, of its value, how can you 
 in good conscience and under the law fail to place upon the 
 two hundred and thirty-eight millions which they have thus 
 partially assessed, a true valuation of seven hundred and 
 ninety millions ? This ignores the whole immense volume of 
 intangible personal property which all concede is not assessed 
 at six per cent, of its true value. 
 
 The Assessment of Merchandise Stocks. 
 
 I frankly acknowledge the obstacles in the path of this 
 investigation into the true value of all the personalty in a 
 great state like Wisconsin. We have no power to re-assess 
 property ; we have no official authority whatever. The Com- 
 mission has wide authority. All that we can do is to present 
 to the Commission such evidence hearing upon values as 
 seems to us authentic and reliable; it is for you to weigh 
 and sift and estimate. 
 
 This line of investigation occurred to us, regarding one 
 important class of tangible personal property — the merchan- 
 dise stocks — that we apply to the Commercial Agency which 
 for many years has been engaged in the business of under- 
 taking to find out the true value of the stocks of merchandise 
 of persons in business who seek credit, and whose places of 
 business are in Wisconsin. This agency did not then and 
 does not now know for what purpose this information was 
 asked. And with regard to all the information which we 
 have sought to place before the Commission I think that you 
 will agree that we have acted impersonally, and in good faith. 
 
 It was manifestly impossible for us to obtain from the 
 Commercial Agency figures as to values identically on the 
 first of May, 1903. All we could do was to say to them, “We 
 
97 
 
 want the last reports you have.” The Burlington Company 
 is a subscriber to this Commercial Agency and has been for 
 many years. I wrote to the manager and said that I wished 
 to know the values of the stocks of merchandise in the City 
 of Madison and in the City of Milwaukee, stated separately, 
 and then also in the whole State of Wisconin. I requested a 
 statement from them as to the method they employ in ascer- 
 taining these values. The reply is dated January 5, 1904, 
 and is as follows: 
 
 “The figures which we have given represent the average 
 standing stocks of merchandise in the State of Wisconsin. 
 The data come from reports covering the entire year of 
 1903, and the figures were also weighed with those of the 
 year previous, as a check against possible discrepancies. In 
 no other way could the estimates have been compiled, as the 
 reports were variously dated from the beginning of the year 
 up to the time the work was started. Nothing was consid- 
 ered except tangible, physical stocks of merchandise. This 
 we understood was the only thing desired. You 
 ask us to inform you in detail how the information is se- 
 cured by this agency, and how we finally record the true 
 value of the stocks. It would indeed be a difficult matter to 
 answer these questions comprehensively, without going 
 through a great deal of tedious and lengthy detail. While 
 we do have a general method, almost every case requires spe- 
 cial treatment, and a deviation from the general rule. In 
 cases where the parties make statements, efforts are always 
 made to confirm the values, from well informed and inde- 
 pendent sources. In some instances authorities have no 
 close knowledge, and base their acceptance of statements on 
 their estimates of the parties’ integrity and reputation for 
 conservativeness. It is not difficult in either large or small 
 places to detect gross overvaluations made for the purpose of 
 bolstering worth. The means by which we discover these 
 misrepresentations are various.” 
 
 “Where statements are not obtained, the estimates of 
 merchandise are made by correspondents, who are best ac- 
 quainted with the merchant reported. Frequently the fig- 
 
98 
 
 ures given represent an average struck from several opin- 
 ions.” 
 
 They reported : “There are eight hundred persons engaged 
 in mercantile business in the City of Madison, and the value 
 of their stocks of merchandise is $2,875,345.” The assess- 
 ment for taxation in 1903 upon those same stocks, by the as- 
 sessors, is $681,091. 
 
 Mr. George R. Peck: Are those reports made up by the 
 
 commercial agency from statements of the merchants them- 
 selves ? 
 
 Mr. Baldwin: Yes, and from investigations they make. 
 
 Mr. George R. Peck: They originate from the merchants 
 themselves, so as to have a standing fixed by which they can 
 get credit. 
 
 Mr. Baldwin : Yes. This is to be said : if a man was ex- 
 pecting to have a fire, or to sell out, he might exaggerate. 
 All that is to be considered. But this is a useful statement 
 of value, and an underestimate, so far as the whole state is 
 concerned. In the City of Madison the assessment of mer- 
 chandise stocks is 24 per cent, of their value. 
 
 Chairman Gilson : Does that relate exclusively to mer- 
 
 chandise, or does it relate to total assets ? Do they separate 
 those things, always, in their reports % 
 
 Mr. Baldwin: Yes, they do. I went to their office in 
 
 Chicago and examined particularly as to that. “Capital” 
 is one question, and the actual “stock of goods” another. 
 Nothing was considered except tangible, physical stocks of 
 merchandise. This was the only thing desired. When it 
 comes to “capital” values, and what the merchant is earning, 
 or what his valuation would be if his merchandise was put 
 into a corporation and the stock of such corporation was 
 
99 
 
 quoted on the Stock Exchange — such a mode of estimating 
 values is only for the railroad; it is not for the merchant. 
 If that test was applied it would make a very different show- 
 ing. But there is nothing reported here except physical 
 stocks of merchandise. 
 
 Mr. Dudley: That does not include any estimate of the 
 
 value of stocks which are not reported ? 
 
 Mr. Baldwin: No. That, now, is your information, and 
 
 at your service; you have all the powers of the state to in- 
 quire here in the City of Madison whether the statements 
 are true or not. We have not. 
 
 In the City of Milwaukee there are 6,794 mercantile es- 
 tablishments, which have $57,073,096 of value in stocks of 
 goods. They are assessed for taxation at $15,100,915, or 
 26 per cent, of their value. 
 
 The remainder of the state is more fairly assessed on 
 stocks of merchandise than Madison and Milwaukee. The 
 total merchandise stocks in the state, as reported, have a 
 value of $179,820,902, in 54,549 different establishments. 
 They are assessed at $61,574,536 for 1903, or 34 per cent, 
 of their value. 
 
 Mr. T. A. Polleys : That schedule is headed “Merchants, 
 
 and Manufacturers’ Stocks.” This includes absolutely noth- 
 ing but merchants’ stocks. 
 
 Mr. Baldwin: That is as I understand it. 
 
 Chairman Gilson: You include all who have merchan- 
 
 dise on hand ; people who are seeking credit. That would 
 include the stock of lumber of a manufacturing concern, 
 would it not ? 
 
 Mr. Baldwin : No } I don’t think it would. 
 
 Mr. Curtis: The assessment figures that you are giving 
 
100 
 
 in connection with this data are the assessment figures of 
 1903? 
 
 Mr. Baldwin: Yes; $61,574,536. 
 
 Mr. Curtis: Does that appear on the face of the mat- 
 
 ter which you submit ? 
 
 Mr. Baldwin: Yes. We know, of course, that there are 
 
 a large number of small dealers not so important that their 
 business finds a place upon the books of a commercial 
 agency. It is a reasonable and fair conclusion from the 
 evidence that the value of merchandise stocks in Wisconsin 
 is, at least, two hundred million dollars. This is very 
 strong corroboration of what you yourselves have announced 
 from the evidence of the probate records, that the prevailing 
 ratio of assessment upon tangible personal property in the 
 state does not exceed thirty per cent, of its true value. 
 
 The following is the table for merchandise stocks: 
 
 MERCHANDISE STOCKS FOR 1903. 
 
 (WISCONSIN.) 
 
 
 Number of 
 Merchants 
 
 Value of Stocks 
 on Hand 
 
 ;Assement of 
 same Stock for 
 Taxation 
 
 Percentage of 
 Assessment to 
 Value 
 
 Madison 
 
 800 
 
 $ 2,875,345 
 
 $ 681,091 
 
 24 
 
 Milwaukee 
 
 6,794 
 
 57,073,096 
 
 15,100,915 
 
 26 
 
 Entire State 
 
 54,549 
 
 179,820,902 
 
 61,574,536 
 
 3-t 
 
 THE LIVE STOCK ASSESSMENT. 
 
 My investigations convince me that, as compared with 
 1900, there has been in 1903 a substantial increase in the 
 assessment upon Wisconsin live stock, on a basis of value — 
 a greater approximation towards true value. 
 
101 
 
 This table shows the valuation for Wisconsin upon live 
 stock appearing in the census reports for the year 1900, 
 and the assessment upon the same classes of live stock for 
 the same year (1900) : 
 
 LIVE STOCK CENSUS VALUATION COMPARED 
 WITH ASSESSMENT OF 1900. 
 
 Horses — 
 
 Census. 
 
 Assessment. 
 
 ^Number . . . . 
 
 641,493 
 
 471,000 
 
 Valuation . . . 
 
 $39,772,560 
 
 $14,928,000 
 
 Average Value . 
 
 $61.75 
 
 $31.67 
 
 Neat Cattle — 
 
 Number 
 
 2,314,105 
 
 1,482,700 
 
 V aluation .... 
 
 $46,849,418 
 
 $18,162,000 
 
 Average Value . 
 
 $20.25 
 
 $12.92 
 
 Sheep and Lambs — 
 
 Number 
 
 1,675,453 
 
 884,120 
 
 Valuation . . . 
 
 $4,510,356 
 
 $1,398,000 
 
 Average Value . 
 
 $2.69 
 
 $1.58 
 
 Swine — 
 
 Number 
 
 2,014,000 
 
 562,330 
 
 Valuation . . . 
 
 $7,580,423 
 
 $1,706,740 
 
 Average Value , 
 
 $3.76 
 
 Census Valuation. 
 
 $3.03 
 
 Assessment (1900 
 
 Total Live Stock in 
 
 Wisconsin. $98,712,757 
 
 $36,194,740 
 
 Those figures would indicate that in 1900 the live stock 
 assessment was about 36 per cent, of value, but the census 
 figures on value are not at all exact or reliable, if you ascer- 
 tain values from what live stock was selling for in the mar- 
 kets in 1900. I do not know where the census people got 
 their figures ; I have no means of knowing what investiga- 
 tions they made into market values. 
 
 *The number of horses includes 85,737 “not on farms.” 
 
102 
 
 Chairman Gilson : They got them in the same way, I 
 
 suppose, that the commercial agency got the amount of the 
 stocks of merchandise in this state, from the statement that 
 the owners made, in the one case to the commercial agency, 
 and in the other to the enumerators ; being the value fixed 
 on such property by the owners. 
 
 Mr. Baldwin: I have here accurate information as to 
 
 true values of live stock in 1900, based upon sales actually 
 made in the market. The Illinois State Board of Agricul- 
 ture made an official statistical report for the year 1900, 
 showing that in that year 83 per cent, of the whole number 
 of hogs assessed in Illinois by local assessors were actually 
 sold and marketed; that the number sold was 2,248,000; 
 and the average live weight was 225 pounds, and the aver- 
 age price received was $4.35 per hundred, or an average 
 price of $9.78 per hog. That was in the Chicago stock mar- 
 ket, which is not tkt* same thing as the farm price in Wis- 
 consin. 
 
 Mr. Curtis: Wasn’t that also after the hog had been 
 
 taking in corn from some time in May until September, in 
 the autumn ? 
 
 Mr. Baldwin: I do not know. I have no doubt that the 
 
 value of the hog in Chicago was greater than the value in 
 Wisconsin; and that the test of value in Wisconsin was not 
 solely the price at which the animal sold for in Chicago. 
 It costs something to sell it; the commissions and freight 
 charges amount to, perhaps, $1.50 per hog. But taking 
 everything into consideration, an average value of $8 for 
 swine in Wisconsin, in the year 1900, based upon actual 
 sales, would be a low value. 
 
 Mr. Curtis: For the autumn valuation, in the market. 
 
103 
 
 Mr. Baldwin : My estimate was on the May valuation. 
 
 A valuation of horses in Wisconsin, in 1900, of $80 per 
 head is a fair and conservative estimate. 
 
 There were sold in the Chicago stock market in 1900, 
 462,197 cattle, all grades of cattle, from Wyoming, and 
 Texas, and elsewhere, and the average price was $47.79 
 per animal. An estimate of $30 each for cattle in Wiscon- 
 sin is fair. 
 
 If these prices for live stock were applied to the 
 Census figures for 1900, the true value was $141,880,939, 
 for those classes, instead of $36,194,740; that is, the as- 
 sessment was at 25 per cent, of value in that year. 
 
 I have said that the live stock assessment for 1903 is upon 
 a much fairer basis than in 1900. 
 
 In 1900 that assessment was $36,000,000; in 1903 it is 
 $73,000,000 in the aggregate. 
 
 In 1900 the assessors made an assessment upon 73 per 
 cent, of the horses, 64 per cent, of the cattle, 53 per cent, 
 of the sheep, and 28 per cent, of the hogs that were actually 
 alive and in Wisconsin, if the Census figures as to numbers 
 are reliable, and this question seems to me very pertinent: 
 Where did the Census enumerators find the hogs, and the 
 horses, and the cattle which they enumerated ? They found 
 them upon the farms, and it is impossible to think that the 
 assessors could not also have found them if they had not, 
 with deliberation, shut their eyes. 
 
 What were the fair, just and reasonable values, the Wis- 
 consin prices, of Wisconsin live stock in May, 1903 ? 
 
 I hold in my hand the Live Stock Report for 1903, of the 
 Union Stock Yards Company, of Chicago, the greatest live 
 stock market in the world. I wrote last week to one of the 
 
104 
 
 official managers of that company a letter from which I will 
 read : 
 
 “The problem we are seeking to solve is this: What was 
 
 the fair value in Wisconsin in May, 1903, per head, of the 
 horses, cattle, sheep and swine ? The assessors, in their 1903 
 assessment, fix $59.32 per head for the horses; $18.32 for 
 the cattle; $2.27 for the sheep and lambs; and $6.51 for the 
 swine. Taking your knowledge of the markets, and the 
 cost of marketing from Wisconsin, will you kindly give me 
 your best judgment as to what price per head should fairly 
 and honestly be stated for these classes of live stock in Wis- 
 consin for the month of May, 1903 V 9 
 
 The quoted official prices for horses in Chicago in May, 
 1903, were as follows: Draft horses, average price, $175; 
 
 carriage horses, $240 ; drivers, $155 ; for general use, $125 ; 
 bussers and trammers, $145; saddlers, $170; and “southern 
 chunks,” $65. 
 
 Mr. Haugen: There are no data given as to young ani- 
 
 mals ? 
 
 Mr. Baldwin: Ho, sir. 
 
 How, in the Chicago stock yards there are dealers who 
 trade exclusively in Wisconsin stock, that is, stock which 
 is shipped in there from Wisconsin, as there are others who 
 deal in Texas stock only, and Iowa stock only. My in- 
 formant applied to the dealers in Wisconsin stock for a cor- 
 rect answer to my questions, and has sent to me the fol- 
 lowing statement of the fair market prices per head of live 
 stock in Wisconsin, in May, 1903, and also the Chicago 
 prices, as follows: 
 
 CHICAGO WISCONSIN 
 
 VALUE. VALUE. 
 
 Cattle $ 44.75 $ 34.00 
 
 Hogs 13.62 11.00 
 
 Sheep 4.05 3.50 
 
 Horses 133.75 123.00 
 
105 
 
 I have made a calculation of the fair valuation of live 
 stock in Wisconsin on May 1 , 1903, estimating the true 
 numbers on the basis of the census figures, as applying 
 to 1903, and taking a value for horses of $80, for cattle 
 $30, for sheep $3, and for hogs $8, and upon such calcu- 
 lation the valuation amounts to $171,032,000, the assess- 
 ment being $73,391,153. 
 
 Mr. Haugen : When he says “in Wisconsin/’ does he 
 
 mean in Milwaukee or at the farm? 
 
 Mr. Baldwin: He says, “In Wisconsin.” 
 
 Chairman Gilson: His judgment in regard to the value 
 
 of these various animals is formed from the animals that 
 are marketed in Chicago ; and he calculates how much less 
 they would be worth in Wisconsin before being shipped 
 there. 
 
 Mr. Baldwin : Yes ; and I think we should take this 
 
 into consideration: that this inquiry was made of intelli- 
 gent people, who have acquired ability and knowledge as 
 to market prices in the course of many years experience. 
 
 I hold in my hand the statistical reprint from the year 
 book of the Department of Agriculture, for 1902, which is 
 issued by the government. This gives the average price 
 of horses in Wisconsin, the farm price of horses in Wis- 
 consin, for the year 1902, at $79. It also gives the number 
 and average price and total value of hogs in every state 
 on the first of January, 1903. It states that in the State 
 of Wisconsin, on January 1, 1903, there were 1,686,885 
 hogs, as against 613,000 found by the assessors, of the 
 average farm value of $8.98 a head, or $15,148,227, as com- 
 pared with less than $4,000,000 found by the assessors, 
 
 Mr. Curtis : In taking your numbers you assumed, did 
 
106 
 
 you, as the census I suppose assumes, that all the sucklings 
 are counted in ? 
 
 Mr. Baldwin : I do not believe that they would rate 
 
 suckling pigs at $8.98. That cannot be the same sort of 
 animals. 
 
 Mr. Curtis: In giving your count, did you assume that 
 
 the census count takes in the sucklings or excludes, them ? 
 
 Mr. Baldwin : I took the census count as it is. 
 
 Mr. Curtis: If it does include the sucklings and old 
 
 plugs, then you would revise your figures as to the average 
 value ? 
 
 Mr. Baldwin: Is there any reason to believe that among 
 
 the seventeen hundred thousand hogs on the first of January, 
 1903 found by the government officials who made the in- 
 vestigation, estimated by them in Wisconsin at nine dollars 
 a head, they included pigs ? 
 
 Mr. Peck: Suppose they did; the government estimate 
 
 shows that the average of the whole is so much. 
 
 Mr. Baldwin: $13.62 was the true market price. 
 
 Mr. Bowers : That would make the average higher. 
 
 Chairman Gilson: The census divides live stock into 
 
 the various ages. They are not all given under one head. 
 You will find those of a certain age, say under two years of 
 age, and so on. 
 
 Mr. Polleys: That is true of cattle, but not of swine. 
 
 Mr. Dudley: I don’t think there are many sucklings in 
 
 existence January first. 
 
 Mr. Curtis: Is there anything to show that the govern- 
 
 ment estimate is made upon any census made as of the date 
 mentioned, January, 1903? 
 
 Mr. Baldwin: I cannot tell. 
 
107 
 
 Mr. Curtis : Is it possible for it to contain those figures 
 
 and to have been compiled and printed at this date ? 
 
 Mr. Baldwin : For 1903 ? 
 
 Mr. Curtis : Oh, yes ; that is a year ago. 
 
 Mr. Baldwin : They have a corps of correspondents, and 
 
 the Agricultural Department has certain sources of informa- 
 tion upon which it relies. 
 
 This same statistical government report contains tables 
 showing the following: 
 
 “Acreage, production, value and distribution of corn, 
 wheat, oats, etc., in the United States, and the stocks on 
 hand in the hands of farmers in the various states on March 
 1, 1903, and the value per bushel.” 
 
 From these official tables I have compiled the following: 
 
 WISCONSIN AGRICULTURAL PRODUCTS. 
 
 AMOUNT IN THE HANDS OF FARMERS MARCH 1, 1903. 
 
 Total Production— On Hand Value per 
 
 Bushels Value March 1, 1903 Value Bushel 
 
 Corn 42,000,000 $21,000,000 13,000,000 $ 6,500,000 $ .50 
 
 Wheat 9,600,000 6,100,000 3,600,000 2,304,000 . 64 
 
 Oats 94,000,000 28,500,000 40,000,000 12,000,000 *30 
 
 Barley 16,500,000 7,600,000 3,800,000 1,750,000 .46 
 
 Rye 6,209,000 3,104,000 1,600,000 800,000 .50 
 
 Potatoes 28,752,000 9,500,000 3,000,000 1,000,000 .33 
 
 Hay 3,268,000 tons 25,854,000 1,200,000 tons 9,492,000 pr ton 7.91 
 
 Tobacco 64,800 tbs. 4,500,000 1,800,000 prlb .07 
 
 $35,646,000 
 
 How, where does all that appear in the assessment on May 
 1, 1903 ? 
 
 Mr. Curtis : How much would you estimate of the stock 
 
 would be depleted two months later? 
 
 Mr. Baldwin: You can form as good an estimate of that 
 as I. Of that thirty-six millions of value in farmers’ hands 
 March 1, 1903, I find in this assessment $1,754,250, the 
 value of “leaf tobacco,” and absolutely nothing else. Why 
 
108 
 
 there is a return made of leaf tobacco, and no other farm 
 product, I do not know. 
 
 Mr. Curtis : The law does not require these miscellaneous 
 farm products to be reported under specific heads. They 
 are under the head “All other property” if at all. 
 
 Mr. John Murphy: Where was this grain stored accord- 
 
 ing to government reports ? 
 
 Mr. Baldwin : It was reported as “in the hands of the 
 
 farmers,” on the first of March, 1903 — $35,646,000 of farm 
 value. 
 
 Mr. John Murphy: Hot in the elevators? 
 
 Mr. Baldwin: Ho. 
 
 The Assessment of Moneys and Credits. 
 
 Regarding a proper valuation of moneys and credits there 
 is certainly much less exactness. I have read with interest 
 and profit the discussion of the Commission in its 1903 re- 
 port, upon the taxing of credits generally, and of taxing 
 capital stock, the mere representative of property. 
 
 I am probably more in accord than I am in discord with 
 many of your views. But there remains your law which, 
 barring the changes as to the assessment of mortgage credits 
 upon taxable lands, still requires you to determine what, 
 according to your best judgment, based upon the evidence, 
 is the fair amount of moneys and credits in Wisconsin which 
 ought to be considered in estimating the total general prop- 
 erty of the state. 
 
 As I have said, you have a banking capital of two hun- 
 dred millions, and a manufacturing capital of four hundred 
 millions, and you are a prosperous commercial and manu- 
 
109 
 
 factoring state, in which money, and taxable credits, as a 
 form of property, are great forms of wealth. In Massachu- 
 setts they assess five hundred millions of bank deposits. 
 You have about one hundred and fifty millions of bank de- 
 posits in Wisconsin. 
 
 Chairman Gilson: When you speak of bank capital you 
 
 speak of deposits, do you ? 
 
 Mr. Baldwin: Yes; I include them. If a man has his 
 
 fortune in cash he is protected by law, and ought to pay 
 taxes. In the present state of the law, that is fair and it is 
 fair for you to consider it. 
 
 In the course of your work you have made some elaborate 
 tables as to the amount of moneys and credits placed upon 
 the tax rolls in different communities. One table especially 
 interested me — that which is shown on page 112 of your 
 1903 report. In that table it appears (in the groups 6, 7 
 and 8, of assessment districts) that assessors of the smaller 
 towns, aggregating nearly 260,000 population, do actually 
 assess moneys and credits to the extent of $78.06 per capita, 
 or a total of $20,276,000. This is not one community, but 
 scores of widely scattered Wisconsin communities ; not one 
 assessor, but many. It seems to indicate that in practically 
 all the smaller towns of Wisconsin there is an assessment 
 of moneys and credits approximating $100 per capita. Why 
 do not assessors in the larger towns and in the cities where 
 the intangible wealth abounds find an equal amount for as- 
 sessment? Do you doubt that, even in these communities, 
 representing 260,000 people, this per capita assessment of 
 $78 is a low assessment? I confidently claim that $78 per 
 capita is a fair figure for you to take as applying to the 
 population of Wisconsin, and that in the final just consid- 
 eration of the true “general property” subject to taxation, 
 
110 
 
 and which can and should shoulder its part of the tax bur- 
 dens along with railroad property, you will put down at 
 least $175,000,000 of moneys and credits, which would be 
 seventy-eight dollars per capita of the present population of 
 the state. 
 
 Here is your view, expressed in the 1903 report, after this 
 careful and painstaking inquiry into the assessment of 
 moneys and credits in 1902 : 
 
 “The amount assessed in 1902 is believed to be but a 
 small portion, or at least not a very large portion, of the 
 total amount of credits legally subject to taxation.” This 
 view you reiterated later on in the same report, in these 
 words : “It is reasonably certain, however, that the total 
 
 amount of credits legally liable to assessment under present 
 day business conditions, after deducting bona fide debts 
 owing by the holders thereof, is a very large sum and it is 
 not doubted that it exceeds many times the seemingly large 
 sum assessed in 1902.” 
 
 Holding these views as you do, based upon actual returns 
 of cash for assessment, I feel the more confidence is asking 
 you to estimate an amount of moneys and credits legally 
 liable to assessment, equal to that being actually returned to 
 assessors for assessment in scores and scores of the smaller 
 assessment districts of the state. 
 
 The situation as you find it, is an intentional under-valua- 
 tion of the amount of moneys and credits subject to taxa- 
 tion by practically all the assessors in the City of Milwaukee, 
 and the larger cities. These particular assessors habitually 
 and intentionally violate the law by returning the moneys 
 and credits in their districts at a much less amount than 
 they know to exist. It is equivalent to fraud on their part — 
 a fraud upon the tax payers in those assessment districts 
 where they do return an average of $78 per capita, and it 
 will be a fraud upon the railroad companies if some ap- 
 
Ill 
 
 proximation to the truth, as to moneys and credits, is not 
 embodied in your estimate of the general property legally 
 liable to taxation, as a basis for determining the just “av- 
 erage rate” which you are seeking. 
 
 A Fair Valuation of Personal Property. 
 
 I said that I hoped to demonstrate in a reasonable way 
 that the assessment of 1903 upon personal property does not 
 exceed thirty per cent, of its value and should, therefore, 
 be made seven hundred and ninety millions. The fact dis- 
 closed by the assessment of the tangible personal property 
 of decedents’ estates, ignoring all intangible property, at 
 thirty per cent, of the appraisement, is proof of a universal 
 practice among assessors in Wisconsin to assess all person- 
 ality at not to exceed thrity per cent, of value. That is not 
 mere “speculation.” It is proof. 
 
 The fact that merchandise stocks are habitually and uni- 
 versally assessed at thirty per cent, of their value confirms 
 the existence of this general and uniform practice in thus 
 assessing all personal property. It is far more reasonable 
 to expect a true assessment of merchants’ stocks than of 
 the property of such corporations as water and lighting 
 companies, or a true assessment of logs, and ties, wagons, 
 watches, or of live stock, or of that indefinite item called 
 “all other personal property.” The assessor has the same 
 sources of information that we have regarding stocks of 
 goods in the hands of merchants. He can go to the mercan- 
 tile agencies, if he wants to, and get information. He can 
 make investigations. 
 
 Mr. Curtis: Do you suppose any assessor, if he had the 
 
 money to put up, could obtain from the commercial agencies 
 
112 
 
 this information as to stocks of goods of merchants and other 
 business men ? 
 
 Mr. Crandon : They do in Chicago. They go right to 
 
 the commercial agencies there. One of the things said to 
 us when we were talking to the commercial agency men was : 
 ‘‘Why, certainly; the board of review, or board of assessors, 
 send over constantly to check up these questions of local as- 
 sessment on stocks of goods and merchandise.” 
 
 Chairman Gilson : As to particular individuals ? 
 
 Mr. Crandon : Yes ; and gave us the names of some. 
 
 Mr. Curtis: I had to fight like everything to get them 
 
 to consent to their depositions being taken, for the purpose 
 of private litigation; which is a long way removed from 
 assessment and taxation purposes. 
 
 Mr. Crandon: One of the men they spoke of was Fred 
 
 TJpham, Chairman of the Board of Tax Review in Chicago. 
 
 Mr. Baldwin : There is abundance of evidence, sound 
 
 evidence, available to you to justify the conclusion that there 
 is a deliberate, systematic and unlawful practice by Wis- 
 consin assessors of assessing the personal property of the 
 state at not over thirty per cent, of actual value. That is 
 not mere “belief” — it is fact. It is far less than the truth, 
 as embodied in the view of all the writers and students of 
 economics, who say that in a commercial and manufactur- 
 ing state like Wisconsin the value of the personality equals 
 if it does not exceed the value of the real estate. 
 
 But the critic will say, “Point out this personal property ; 
 tell us where you find it.” In reply to that, I respectfully 
 submit the following: 
 

 113 
 
 A Valuation of Wisconsin Personalty. 
 (1903.) 
 
 Merchandise Stocks $200,000,000 
 
 Live Stock 171,000,000 
 
 Moneys and Credits . 175,000,000 
 
 Bank Stocks 22,000,000 
 
 Logs, Timber, Lumber, etc 40,024,000 
 
 Steam and other Vessels. . . . 1,870,000 
 
 Water and Light Companies 31,698,000 
 
 Wagons, Carriages, ete 20,006,000 
 
 Watches 438,000 
 
 Pianos . . . . 9,528,000 
 
 All other Personal Property 80,048,000 
 
 $751,612,000 
 
 Briefly stated, this table gives values to stocks of merchan- 
 dise, live stock, moneys and credits, and bank stocks, based 
 upon specific evidence, and as to all the other items determ- 
 ines value from the fact that the personalty assessment 
 is uniformly not to exceed thirty per cent, of value : 
 This percentage is applied to the 1903 assessment, as reported 
 for the various items. 
 
 Chairman Gilson: As to bank deposits the amount re- 
 
 ported is one hundred and fifty to sixty millions. There 
 is in actual moneys in those banks, however, probably not 
 to exceed $20,000,000. The balance of it is credits; the 
 amount they owe their depositors. And those depositors 
 are entitled to off-sets under the existing law in arriving 
 at the amount they are to be taxed as credits. 
 
114 
 
 Average Tax Rate Upon Value of Property in Ad join- 
 ing States. 
 
 You are to establish and declare for Wisconsin such a 
 tax rate, to be levied upon railroad property, as will make 
 that class of property pay the rate that would be paid upon 
 the average by all the general property of the state, if all 
 general property was assessed at its full and true value. 
 
 In the states adjoining Wisconsin this average rate of tax- 
 ation does not exceed seven mills and a half on the dollar. 
 In the State of Iowa it is about seven and one-half mills, 
 while in Illinois, Missouri and Nebraska it is less. 
 
 It does not follow that because the citizens of adjoining 
 states pay a tax rate of seven mills upon the full value of 
 their property that the property owners in Wisconsin are not 
 in fact paying a higher rate. But you are not dealing with 
 exact conditions. The whole question depends upon how you 
 estimate land values and how you estimate personalty values. 
 It is a process of estimation. So it has been in a measure, in 
 these adjacent states. My information as to facts there is 
 gathered partly from my own personal knowledge and partly 
 from information given me by the officials of Iowa and Illi- 
 nois and other states. 
 
 The law of Iow r a requires all property to be valued at full 
 value, and then provides that it shall be assessed for taxation 
 at twenty-five per cent, of such full value. In Illinois the 
 proportion named for assessment is twenty per cent, of full 
 value, by statute. There is no such statute in Missouri, or 
 Nebraska. As to railroads, in all the states named, it is 
 simply a question of their valuation. The assessing boards 
 determine upon evidence what is the proportion of assess- 
 
115 
 
 merit to full value adopted or prevailing in the practice of 
 the assessors of the general property and this proportion or 
 ratio they apply to railroad valuations, which then pay the 
 same rate of taxation that is levied upon other property in 
 the various taxing districts in which the railroad property is 
 situated. The average rate upon full value in Iowa is seven 
 and one-half mills. 
 
 Mr. Haugen : The tax paid by the railroad would vary 
 
 with the different companies, depending on the taxing dis- 
 tricts in which they run. 
 
 Mr. Baldwin: Yes; the rate of seven and one-half mills 
 
 is the average rate paid by the owners of the general prop- 
 erty in Iowa. Take the sum of all the taxes paid in Iowa 
 and the sum of all the assessment, and it comes to about 
 thirty-nine mills. The State Board of Equalization, in fix- 
 ing the value of railroads, after a most thorough examina- 
 tion two years ago, found that farm lands were in fact as- 
 sessed at about seventeen per cent, of their true full value; 
 and they applied this ratio or proportion to their valuation 
 of the railroads. This is simply another illustration of what 
 human assessors do in the matter of taxation. The Iowa law 
 says that all property shall be returned at its full value, and 
 pay taxes upon twenty-five per cent, of such full value, but 
 nevertheless the Iowa farmers assessed their farms at seven- 
 teen per cent, of value. At the 1903 meeting, after full in- 
 vestigation, it was decided that the ratio is now twenty per 
 cent. Therefore, the property of Iowa is paying upon its full 
 value an average tax rate of seven and a half mills on the 
 dollar. 
 
 In the case of Illinois, I will read from a letter to myself 
 from the State Auditor, stating: “Relative to the matter of 
 
 valuations of taxable property in this state, as determined 
 
116 
 
 upon by the various assessors, the property is not valued at 
 its full fair cash value. The State Board of Equalization at 
 its last session passed the following resolution: c Whereas, it 
 
 has been the opinion of the individual members of this Board 
 ever since the receipt of the returns of the several county 
 clerks, that the real and personal property of the state has 
 been valued, for the purpose of assessment, for the year 1903 
 at not to. exceed 70 per cent, of its fair cash value ; therefore, 
 in order to give expression of such opinion as a Board, 
 
 “Be it Resolved, That in the opinion of this Board, and 
 the Board so finds after a careful investigation and full 
 consideration, that the real and personal property of the state 
 has been valued for the purpose of assessment for the year 
 1903 at not to exceed 70 per cent, of its fair cash value.” ’ ” 
 
 To find the average rate, take 20 per cent, of that or 11 
 per cent, of the rate for the whole state. In Illinois, out- 
 side of the City of Chicago, the average full rate is 45 mills. 
 I have another letter from him stating that. So that, if you 
 apply that in the same way you have an average tax rate 
 upon full value of 6 3-10 mills for the State of Illinois, out- 
 side of Chicago. 
 
 Missouri has the lowest tax rate of any western state. The 
 total tax rate upon property in Missouri is less than 21 mills ; 
 and it was a surprise to find that in the City and County of 
 St. Louis it is just a trifle more than it is in the rest of the 
 state. 
 
 I have here equally satisfactory information from the offi- 
 cials of that state that the assessment of farm property is 
 made upon a basis of 33 per cent. Hence, the rate that is 
 being paid in Missouri is seven mills upon full value. In 
 Nebraska it is not over six mills. 
 
 What reason is there for believing that the general prop- 
 
117 
 
 erty, the land and the personal property, in a state like Wis- 
 consin is paying, in proportion to its actual value, a much 
 higher tax rate than prevails in Iowa, or in Illinois, or in 
 Missouri, or in Nebraska? It has no larger proportion of 
 cities or towns, with high tax rates, in proportion to popula- 
 tion. Its expenditures for state purposes, or for the cost of 
 schools, or for county or village government, is no greater in 
 proportion to population than is theirs. Its actual per capita 
 wealth is fully equal to theirs. How, then, can it follow that 
 the average tax rate upon property in Iowa and Illinois and 
 Missouri and in Nebraska does not exceed seven and a half 
 mills in any state, while in Wisconsin it is greater? The 
 answer must he found in the estimate of the proportion of the 
 local assessment to actual value. 
 
 The Commission now has substantial and satisfactory evi- 
 dence that the value of the entire real estate of Wisconsin is 
 not less than seventeen hundred and fifty millions, and that 
 the value of the personalty equals seven hundred and fifty 
 millions, or forty-three per cent, of the real estate. This 
 would indicate a value for the general property of Wisconsin 
 of twenty-five hundred millions, and an average tax rate of 
 about eight mills. 
 
 Judge Taft's Decision in the Louisville & Nashville 
 
 Case. 
 
 Mr. Crandon called the attention of the Commission to the 
 case of Taylor vs. Louisville & Nashville Railroad Company , 
 decided by the United States Court of Appeals, the opinion 
 being written by Judge Taft, now a member of President 
 Roosevelt’s Cabinet. Because of its importance and perti- 
 nence to the matters now before you, it is hoped that the 
 
118 
 
 members of the Commission will consider it. It is reported 
 in 88 Federal Reporter, page 350. 
 
 This decision, and the many others which are cited and 
 approved in the opinion, seem to clearly justify these con- 
 clusions : 
 
 First. A constitutional provision enjoining equality and 
 uniformity in taxation is paramount, and overrides acts of 
 the legislature. 
 
 Second. Courts will direct a proper and equal assessment, 
 on complaint of any class of taxpayers owning a species of 
 property about to be taxed at higher rates than the owners 
 of another species of property. 
 
 Third. Courts treat the assessment of the general prop- 
 erty of the state as an entirety, and compare it in proportion 
 to full value with the railroad assessment as an entirety, and 
 regard as “absolutely futile” the suggestion that railroad 
 companies go before local taxing boards and attempt to se- 
 cure changes in the prevailing methods of assessment, whether 
 as to omissions or undervaluations of property. 
 
 Fourth. All that it is necessary to show is that there exists 
 among the local assessors of the state an intentional and sys- 
 tematic disregard of the law, the effect of which would be, if 
 it was ignored, to cause railroad property to be taxed at a 
 higher average rate than the owners of all the other property 
 are taxed, whether this intentional disregard is through sys- 
 tematic failure to assess or systematic undervaluation of that 
 which is assessed. 
 
 Fifth. Inequalities due to mere mistake, or to the falli- 
 bility of human judgment must be borne. Sporadic cases 
 of discrimination cannot be remedied. But when there ex- 
 ists systematic and intentional practices in the assessment of 
 
119 
 
 property, the result of which will unjustly distribute the 
 burden of taxation, such practices cannot be overlooked. 
 
 This Commission is the supreme authority in Wisconsin, 
 with power to take into just consideration every fact and 
 every form of discrimination, which tends to nullify the 
 requirement of the constitution that taxation shall be uni- 
 form. 
 
 The Iowa Tax Rate is Seven and a Half Mills. 
 
 The following is one of the letters referred to in my re- 
 marks : 
 
 “State of Iowa, Department of State. 
 
 Des Moines, Iowa, January 2, 1904. 
 
 W. W. Baldwin, Esq., 
 
 Ass’t to President, C. B. & Q., 
 
 Burlington, Iowa. 
 
 Dear Sir : 
 
 In response to your inquiry as to what is the average tax 
 rate upon full value of property in the State of Iowa, will 
 say that I can only refer you to the official figures as returned 
 to the State Auditor and taken from his last public report. 
 
 He issues a statement showing that the total taxable value 
 of all property assessed by local assessors, for the year 1901, 
 was $558,654,871. The taxes upon this property were paid 
 in the subsequent year and amounted in the aggregate to 
 $22,542,580.45, which included $400,000 (estimated) re- 
 turned as special taxes ; that is, levies in cities for sidewalks, 
 pavements, sewers, etc., which, being deducted, leaves the 
 general property tax, including that paid by the railroads, 
 $22,142,580.45. The railroads paid for that year $1,563,- 
 492, so that apparently the amount of taxes levied upon the 
 assessed general property, real and personal, in the State of 
 Iowa amounted to $20,579,088.45. 
 
 This includes poll taxes, which were considerable, and 
 does not take any account of uncollected taxes, but if that 
 figure' is taken as the correct amount levied upon the total 
 
120 
 
 assessed property, as before indicated, it would show an aver- 
 age tax rate upon the assessed property of a little less than 
 39 mills. The law of Iowa requires property to he assessed 
 at 25 per cent, of its full value, but the State Board of Re- 
 view estimated, after a careful investigation made two years 
 ago, that the assessment of farm lands did not exceed 17 3-10 
 of full value. 
 
 Owing to a general increase of values there was a marked 
 increase in the valuation of property by the local assessors 
 and the State Board of Review in July, 1903, estimated that 
 the valuation, when completed, was near twenty per cent, of 
 the actual value. If twenty per cent, is taken as a correct 
 figure it would indicate that the rate of tax to full value in 
 the State of Iowa is a fraction less than seven and a half 
 mills. 
 
 Respectfully, 
 
 (Signed) W. B. Martin, 
 
 Secretary of State.” 
 
 Statement of T. A. Polleys on Ti-ie Value of the 
 Real Estate in Wisconsin Subject to 
 Taxation. 
 
 Mr. Polleys: Mr. Chairman and Gentlemen of the Com- 
 mission: I wish to be heard, as briefly as I may, upon the 
 
 single question of the realty value of the State of Wis- 
 consin, and I wish to preface my remarks by the statement 
 and request that, in all that I may say, I desire to be under- 
 stood as in entire accord with all that has been said here by 
 the gentlemen who have preceded me, upon the following 
 propositions: First, in the land sale statistics, as I 
 
 shall call them, upon which the calculations of the Board in 
 prior years and upon which my calculations this year, have 
 been based, there is a large element of error. There are 
 many improper transactions carried into those statistics 
 which have not been eliminated, and I think cannot be elimi- 
 
121 
 
 nated by any process of examination which can be carried 
 on by the Board operating here at Madison. Secondly, 
 the general trend of the improper matter which is present 
 in that body of statistics is to produce, when made the basis 
 of the calculations in the manner pointed out by the Board, 
 too low an aggregate valuation for the realty under con- 
 sideration. Thirdly, I wish to state that I agree entirely, so 
 far as I have the means to form a judgment, in the conclu- 
 sion of Mr. Dudley, that the realty of the State of Wis- 
 consin is probably, and I think undoubtedly, worth not less 
 than the sum stated by him this morning, between $1,700,- 
 000,000 and 1,800,000,000; and I should say it might very 
 reasonably and properly be argued to be worth beyond 
 $ 2 , 000 , 000 , 000 . 
 
 In what I have to say I shall confine myself quite closely 
 to the typewritten notes I made day before yesterday. 
 I wish to say in direct connection with what I have just 
 remarked, that, speaking for myself only, I am con- 
 vinced that the general plan adopted by the Board for ascer- 
 taining the true value of the realty of the state is theoretically 
 the best yet devised. Now stripped of all unnecessary de- 
 tails the theory of that plan — and- I am speaking of the 
 theory and not the practice — is merely this: The full cash 
 
 prices for which lands within a given district are act- 
 ually sold under normal conditions, in the open market, 
 furnish the best basis for determining the actual true 
 cash or market value of all lands within that district, 
 whether it be an assessment district, a county or a 
 state. The result arrived at by following the Board’s plan 
 will more and more nearly approximate the truth in just 
 the measure that the statistics of land sales, upon which the 
 arithmetical calculations are all based, contain only sales 
 
122 
 
 made at full cash prices and under normal conditions. No 
 one contends that the statistics of land sales thus far trans- 
 mitted, from year to year, to the secretary of state by the 
 various registers of deeds, contain all that they should con- 
 tain, and nothing that they should not contain. I 
 take it that the Board itself frankly admits this, 
 by the effort it has made to have the law relative to 
 such statistics properly amended, and, as amended, properly 
 carried out by the various registers of deeds. The general 
 tendency of the transactions, which are improperly included, 
 as I remarked a moment ago, by the registers of deeds in 
 their annual reports of land sales, is towards the production 
 of too low an aggregate valuation of the realty; and I will 
 merely enumerate a number of the different sorts of trans- 
 actions of that character which have occurred to me. 
 
 First, the tax sales. They are directed to drop these out, 
 but they do not drop them out. Secondly, foreclosure and 
 execution sales. Third, sales subject to mortgage. Now, 
 all these are covered by the statute, as amended, but it is 
 perfectly obvious that the statute as amended is not being 
 carried out and perhaps will not be carried out without 
 careful supervision. 
 
 Mr. Curtis: The statute, as amended, includes tax sales. 
 
 Mr. Polleys : Yes. 
 
 Mr. Curtis : I thought vou stated that the statute as 
 
 amended did not, in form, exclude them. 
 
 Mr. Polleys: I say, it does in form exclude all these 
 
 things I have mentioned. Fourth, sales of undivided in- 
 terests. Fifth, sales by quitclaim, or special warranty deed. 
 Sixth, deeds pursuant to land contracts. There is many 
 a deed that is going on record of course in different parts 
 
123 
 
 of the state where the deed is executed pursuant to land con- 
 tract made long ago when the land was unimproved. The 
 deed is made after the man has gone upon the land and im- 
 proved it, and the land is worth twice or three times as much 
 as at the time the land contract was made, and yet the con- 
 sideration written in the deed is the land contract consid- 
 eration. Seventh, the improper transactions to which Mr. 
 Dudley alluded this morning, and that is the class in which 
 the consideration is intentionally understated by the parties 
 to the transaction. I believe — and I wish to say it frankly — 
 that that is one of the great dangers to which the theory of 
 the Board as to arriving at realty values will be subjected in 
 the time immediately ahead of us. 
 
 Now, on the other hand, there are certain transactions 
 which undoubtedly get into this body of statistics which tend 
 in an opposite direction; but I do not think for a moment 
 that in relative number or in relative importance they com- 
 pare with the group to which I have just called attention. 
 In this second class are, first, exchanges of real estate in 
 which no cash, or only a relatively small amount of cash, 
 passes and the consideration on both sides is overstated by 
 the parties to it; that is, where each fellow is in a trading 
 mood, and calls his property worth a good deal more than it 
 actually is worth. 
 
 Mr. Curtis : Speculative figures. 
 
 Mr. Polleys: Speculative figures; and I do not doubt 
 
 there are transactions of that kind ; in fact, I remember of 
 Mr. Haugen calling my attention to one or two transactions 
 of that kind in St. Croix County. Then there is the group 
 of cases where, usually by the wish of the grantee, the con- 
 sideration is overstated. 
 
 Outside of those two groups I can think of nothing at 
 
124 
 
 present which, goes to offset the large number which I cited 
 in the other class. 
 
 Mr. Curtis : Isn’t there quite a large class of cases where 
 
 something other than land has actually passed between the 
 parties, and the consideration for the whole transaction is 
 stated as the consideration for the conveyance ? As, for in- 
 stance, the transfer of a farm, including the personal prop- 
 erty upon it? 
 
 Mr. Polleys: Yes, I heard of an instance of that kind 
 in St. Croix County, while I was carrying on the work 
 there, of a valuable farm that was transferred, and the last 
 time the personalty upon the farm was included. 
 
 Chairman Gilson: The statement has been made byf 
 
 gentlemen representing counties before this Board seeking a 
 lower assessment, that a large number of conveyances in 
 their counties included personal property or other property 
 spoken of by Mr. Curtis; and for that reason they urged 
 that it produced too high a valuation of the property in their 
 county. 
 
 Mr. Polleys: I think that those gentlemen see double on 
 
 those things. I do not imagine that, there are any large 
 number, but I wish to be understood as conceding that things 
 of that kind do occur occasionally ; but, as compared with the 
 large mass of transactions that get into these statistics, and 
 properly get into them, it is a comparatively small matter, 
 I think. Now, I believe that the Board will agree 
 that the group of improper transactions which tends 
 to produce too low an aggregate, on the whole out- 
 weighs the other group ; and this is shown by the fact that in 
 the process of elimination, which you have gone through 
 here, as I know, in computing the different districts, on 
 
125 
 
 the whole you have found that the process results in some- 
 what larger aggregates than you get without elimination. 
 On that question of elimination I wish simply to repeat 
 what I said before: that I do not think it can be thoroughly 
 or properly carried on here at Madison, merely from an in- 
 spection of the reports of the registers filed at Madison. 
 This was more fully shown by Mr. Dudley - this morning, 
 and the reason stated why that must be so. Such a process 
 of elimination must still leave in the body of statistics 
 many transactions which do not properly belong there. Im- 
 provement of the statistics will result from a careful super- 
 vision and checking up of the registers, and a very heart- 
 less disallowance of fees, where they do not make up such 
 reports as they ought to from the deeds they have before 
 them. So it seems to me that the aggregate value of realty 
 within the state, which is reached by using the statistics as 
 filed at Madison, whether computations are made for a long 
 period or a short period, are uniformly lower than they 
 would be but for the presence of improper transactions in 
 the statistics. 
 
 So much by way of introduction. 
 
 How, this is the main proposition to which I wish to ad- 
 dress myself : To determine approximately the present true 
 
 cash value of all the realty within the State of Wisconsin, 
 it is unnecessary (and being unnecessary is therefore un- 
 just) for the Board to take into account land sales for a 
 longer period than the twelve months expiring September 
 1, 1903. 
 
 The determination by the Board of the value in 1903 of 
 the general property of the state is one matter, and 
 the determination of the value of the respective railroad 
 properties within the state, as of the same time, is an entirely 
 
126 
 
 distinct matter, and the two should not be unnecessarily 
 coupled together by the Board. There may be, and I have 
 no doubt there are, many reasons why the value of railroad 
 properties can only be fairly estimated by taking a period 
 extending over quite a number of years, which reasons do 
 not at all control in the determination of the aggregate value 
 of a large body of lands as of a given time. 
 
 The aggregate value of realty in the State of Wisconsin 
 as fixed by the Board in October last, for equaliza- 
 tion purposes, at $1,309,504,464, was arrived at, as I un- 
 derstand, by calculations made in accordance with the plan 
 or formula of the Board, and based upon the land sales with- 
 in the various assessment districts, for a five years’ period 
 ending September 1, 1902. 
 
 Before proceeding farther I will give the result obtained 
 by me, as compared with the results of the Board, in calcu- 
 lating, in accordance with the methods described by the 
 Board, the realty values of Dane and Dodge counties for 
 both the seven years’ and the five years’ period, and of 
 Clark and St. Croix counties for the five years’ period. 
 
 Mr. Haugen : Your periods end when ? 
 
 Mr. Polleys : The seven years’ period, on September 1, 
 
 1901, and the five years’ period on September 1, 1902: 
 the ratios worked out being related in each instance to the 
 assessment of the preceding year, prior to the time the 
 land sales reports were made out — well, that is not en- 
 tirely true, because you will remember the Board itself, in 
 having its computations made, made a change at the year 
 1899. For instance, the assessment rolls of the year 1899 
 were used by the Board itself in the computations which 
 have been made for it based on the land sales for the year 
 ending September 1, 1899 ; and also as the basis of the com- 
 
127 
 
 putations for the year ending September 1, 1900. I have 
 used them in the same manner that the Board used them, as 
 I was informed. 
 
 Mr. Haugen : I wanted to know whether you brought it 
 
 up to the 1st day of September, 1903 ? 
 
 Mr. Polleys: I do bring the values of the state down to 
 
 that time ; but the last year is no part of the five years’ or 
 seven years’ period. 
 
 How, I will ask close attention to these figures, although 
 they are figures, and to the close- comparison and corre- 
 spondence which will appear throughout, between the results 
 which I have reached and the results which the Board has 
 reached. 
 
 On the seven years’ period the Board found Dane County 
 realty to be worth $57,266,795. I found it to be $57,- 
 917,106. 
 
 Dodge County, seven years’ period, the Board’s result, 
 $41,615,979; our result, $41,734,473. , 
 
 How take the five years’ period: 
 
 Dane County, for the Board, $60,725,027 ; our result, 
 $60,411,723. 
 
 Dodge County, for the board, $43,337,744; our result, 
 $42,243,500 ; the largest discrepancy that appears, I think. 
 
 St. Croix County, the Board’s result, $11,130,263 ; our 
 result, $11,196,019. 
 
 Clark County, the Board’s result, $11,786,730; our re- 
 sult, $11,898,164. 
 
 I lay considerable stress upon the correspondence of the 
 combined results, because it is not one county or one town- 
 ship we are figuring on ; it is the state at large. The Board’s 
 
128 
 
 combined result for the five years’ period, for the four 
 counties, is $126,979,764; our result, $125,749,406. 
 
 That, you will understand, is reached by my going through 
 the very same process outlined by your Board, taking up 
 each assessment district by itself, and figuring the average 
 five years’ valuation, in the precise method, as I understand 
 it, outlined and prescribed by your Board. 
 
 Mr. Curtis : Except, in making your elimination of items 
 you exercised your judgment according to the general plan 
 as you understood it to be by the Board; and in our work 
 it was the exercise of the individual judgment of the person 
 supervising the work. 
 
 Mr. Polleys: Let me say right there, I find I am cor- 
 
 roborated in the idea that such elimination as has been made, 
 or can be made, on the whole, when you take the state at 
 large, or a county at large, is relatively an unimportant 
 matter, and the eliminations that were made by me, or for 
 me, practically amounted to nothing whatever in three coun- 
 ties. I took the statistics just as they were in the counties 
 of Dane, St. Croix and Dodge. I don’t think there were 
 half a dozen transactions eliminated in our work. Those 
 you can check. They were eliminated by Mr. Sudheimer, 
 who was working with me. 
 
 Mr. Baldwin : Doesn’t that establish, with a good deal of 
 conclusiveness, that there were practically no eliminations 
 made by the men who made the other computations ? 
 
 Mr. Polleys : Well, yes and no. The eliminations that 
 
 were made by the other gentlemen bore both ways. 
 
 Mr. Haugen: You made fewer eliminations than the 
 
 Board ? 
 
 Mr. Polleys : Yes. 
 
129 
 
 Mr. Haugen: The Board made more eliminations than 
 
 you did ? 
 
 Mr. Polleys: Yes. In Clark County, I wish to say that 
 the land sale statistics are in very had condition; and in 
 order to get any sort of a figure for Clark County we had to 
 eliminate quite a good deal. Just how much, I cannot say, 
 but the elimination for Clark County amounted to more than 
 the other three counties combined. 
 
 Mr. Haugen : That would he so in all cases where land 
 
 sales have been as numerous for the last few years as they 
 have been in Clark County. 
 
 Mr. Polleys : Yes, I presume that would be the tendency. 
 
 Mr. Haugen : Large tracts have been sold. 
 
 Mr. Polleys: The fact that the aggregate of our com- 
 
 puted realty value for the four counties named, 
 so very closely approximates the aggregate of the 
 Board for the same counties, tends to prove the 
 relative unimportance (when the problem is considered 
 in a large way) of such eliminations as can properly be made 
 from a mere inspection of the statistics as filed at Madison. 
 
 It is of the utmost importance to constantly bear in mind 
 that, so far as concerns the taxation of railroads, all the 
 Board is required to do as to realty, is to determine, with as 
 close approach to correctness as possible, the aggregate value 
 of all the realty within the State of Wisconsin on the tax 
 rolls for the year 1903, possibly I might say, all the taxable 
 real estate within the state for that year. For the pur- 
 pose of determining this general question, the Board is not 
 concerned with, and is under no necessity to consider, what 
 is the realty value for 1903 of each assessment district within 
 the state, or even of each county, separately, within the 
 state. 
 
130 
 
 I now desire to call the attention of the Board to some of 
 the facts which tend to prove that the realty values of the 
 four counties, Dane, Dodge, St. Croix and Clark, when com- 
 puted in accordance with the method of the Board, hut on the 
 basis of land sales for twelve month periods only, are sub- 
 stantially correct. For convenience, I shall call this the 
 “yearly realty value” of the respective counties. I will use 
 that phrase as a short expression. 
 
 Now, let me explain right there what I mean by that. 
 Take the County of Dane. I first computed the realty value 
 of each assessment district in the county separately, on the 
 basis of the land sales in the district for one year, using 
 the formula of the Board. Then I added together the forty- 
 five or more assessment district realty values thus found, 
 and their sum is what I denominate as the “yearly realty 
 value” of the county for that particular year. 
 
 Mr. Curtis : In other words, you make calculations based 
 upon the statistics of the sales of one year, and the assess- 
 ment of one year. 
 
 Mr. Polleys : Yes. 
 
 Mr. ITaugen: Don’t you have this difficulty, in a great 
 
 many assessment districts you will find no data to go upon? 
 
 Mr. Polleys: Yes; and when I found that was so, I just 
 took the assessed value of the district as its full value, and 
 I took the worst of it as it seems to me. There are not very 
 many cases of that kind. 
 
 Mr. Haugen : When there were only one or two sales you 
 would be about as bad off ? 
 
 Mr. Polleys: Yes; but one of my main points is the self- 
 compensating character of the errors that arise from the ap- 
 plication of your plan. We are not dealing with a single 
 
131 
 
 township. We are not dealing with a county. We are deal- 
 ing with a large district, the State of Wisconsin. And these 
 aberrations that arise from the application of your theory to 
 facts which are slightly abnormal in a given district, simply 
 rectify themselves ; and I believe if you will watch the figures 
 closely you will be convinced. I was simply explaining how 
 I arrived at the gross amount of a county, in a given year. 
 It is merely by computing each district, as you prescribe it 
 shall be done, and then adding all the assessment districts in 
 the county together. That is the way I arrive at these yearly 
 values. 
 
 And now, just a few observations as to average realty 
 values for the five and seven year periods fixed by the Board. 
 
 First, as Mr. Fhidley noted this morning, it is perfectly 
 obvious that the average value for any given period consist- 
 ing of a number of years cannot he the value at the end of the 
 period, of course, unless things have stood absolutely station- 
 ary from A to Z during that period, which they do not do, 
 and have not done. FTow if values increase uniformly 
 throughout the period, then the average value for the period 
 will be the value at the center of the period. These are 
 mere arithmetical propositions, which I trust prove them- 
 selves. If values increase more rapidly during the latter 
 half of the period — and I think we shall be able to show 
 you they have done so — then your average value is some- 
 what, but not much, more than the value at the center of the 
 period. 
 
 How during the six years ending September 1, 1903, the 
 average selling price of lands, per acre, in each of the four 
 counties named, has steadily advanced, as is shown by the 
 following table. I will take up Dane County. When I men- 
 tion a year, it will be understood it is the twelve month pe- 
 riod, expiring September 1st of the year mentioned: 
 
132 
 
 1898. , 
 
 . . .13,854 
 
 acres 
 
 sold at average of $41.34 
 
 1899. , 
 
 . . .26,292 
 
 acres 
 
 sold at average of 
 
 43.87 
 
 1900. . 
 
 . . .30,894 
 
 acres 
 
 sold at average of 
 
 47.48 
 
 1901. . 
 
 , . .27,586 
 
 acres 
 
 sold at average of 
 
 50.03 
 
 1902. , 
 
 . . .28,701 
 
 acres 
 
 sold at average of 
 
 52.72 
 
 1903. . 
 
 O* 
 
 GO 
 
 acres 
 
 sold at average of 
 
 53.58 
 
 Mr. Haugen : You 
 
 . take the figures reported hy the reg- 
 
 isters. You eliminate 
 
 some 
 
 of those ? 
 
 
 Mr. Polleys : Yes, 
 
 that is true. 
 
 
 Then, in 
 
 Dodge County— 
 
 -the years are the same — hut in 
 
 Dodge County the progression is as follows : 
 
 
 
 1898 
 
 
 $58.22 
 
 
 
 1899 
 
 
 57.75 
 
 
 
 1900 
 
 
 62.99 
 
 
 
 1901 
 
 
 68.49 
 
 
 
 1902 
 
 
 72.99 
 
 
 
 1903 
 
 
 
 
 Now in Dodge County the number of acres transferred, 
 varies from 13,000 to 22,000 per year. In St. Croix County 
 the acres transferred varied from a little less than 30,000 to 
 somewhat more than 45,000 per year. And the progression 
 in selling price was as follows : 
 
 1898 
 
 $12.16 
 
 1899 
 
 14.42 
 
 1900 
 
 14.71 
 
 1901 
 
 16.72 
 
 1902 
 
 21.88 
 
 1903 
 
 26.72 
 
 Mr. Haugen: I have $21.90, just 2 cents difference; and 
 the last figure is identically the same. 
 
 Mr. Polleys : Clark County you will find different. There 
 
133 
 
 the acreage transferred was abnormal, certainly, in some of 
 the years. I think I will read the acreage transferred : 
 
 1898 36,327 
 
 1899 92,373 
 
 1900 133,394 
 
 1901 73,284 
 
 1902 76,816 
 
 1903 62,216 
 
 Yon have to eliminate a large number of transfers in order 
 to arrive at any computation. 
 
 Mr. Curtis : You reached the conclusion that the Clark 
 
 County sales included some tax sales as well ? 
 
 Mr. Polleys : I didn’t have time to look into that point, 
 
 as you undoubtedly have. I found this was more than the 
 four days’ job I told you I thought it would be. 
 
 Yow, the progression of average selling price, in Clark 
 County, is very striking. Beginning with 1898 the selling 
 price per acre advanced as follows: 
 
 1898 
 
 1899 
 
 1900 
 
 1901 
 
 1902 
 
 1903 
 
 $ 9.56 
 8.77 
 9.17 
 13.59 
 16.24 
 18.19 
 
 Mr. Haugen: You are a little higher than I am the last 
 
 two years. 
 
 Mr. Polleys: Yow right there, let us just call attention to 
 the jump from 1902 to 1903. In Dane County it advanced 
 from $52.72 to $53.58; in Dodge County from $72.99 to 
 $81.90; in St. Croix County from $21.88 to $26.72; in 
 Clark County from $16.24 to $18.19. Yow, your five years’ 
 
134 
 
 period, which is the basis of your October, 1903, valuation 
 of realty, takes no account whatever, of course, of any of the 
 advance in selling price which has gone on for the twelve 
 months expiring September 1, 1903. 
 
 Mr. Baldwin: Just for my information, will you give 
 
 the first and the last ? 
 
 Mr. Polleys: Dane County advanced from $41.34 to 
 
 $53.58; Dodge County advanced from $58.22 to $81.90; 
 St. Croix County advanced from $12.16 to $26.72; Clark 
 County advanced from $9.56 to $18.19. 
 
 In Dodge, St. Croix and Clark counties, lands, or acre 
 property, comprises the great bulk of the realty value of the 
 counties. In Dane County, Madison and other incorporated 
 cities and villages comprise not far from one-third of the 
 realty value of the county. 
 
 I am now coming to several cross-checks upon my yearly 
 realty values for these counties. 
 
 If, as we contend is the fact, the yearly realty value of the 
 four counties named is substantially correct, then we ought 
 to expect to see such yearly value advancing from year to 
 year, substantially in the measure that the average price per 
 acre for which lands were sold, increased, and that is pre- 
 cisely what we do see from an inspection of the following 
 table. 
 
 How I am giving you my yearly values as computed in 
 the manner I have stated, for the different counties ; and you 
 will see where it drops back slightly — but in the same places 
 you will find a slight drop-back in the selling price also. 
 
 In Dane County this is the progression of yearly realty 
 values of the county, beginning with 1895: 
 
135 
 
 1895 
 
 $51,536,743 
 
 1896 
 
 53,979,644 
 
 1897 
 
 53,065,969 
 
 1898 
 
 57,095,451 
 
 1899 
 
 55,316,097 
 
 1900 
 
 58,659,456 
 
 1901 
 
 67,664,496 
 
 1902 
 
 71,003,999 
 
 1903 . . 
 
 
 Mr. Curtis : Those were 
 
 your yearly values ? 
 
 Mr. Polleys: Yes. 
 
 
 Mr. Curtis: Your statistical matter will all be filed? 
 
 Mr. Polleys: Yes; but I have but one copy, and I would 
 
 like to preserve it. 
 
 
 In Dodge County the progression of yearly realty values 
 is as follows, beginning with 1895 : 
 
 1895 
 
 $40,311,197 
 
 1896 
 
 41,272,543 
 
 1897 
 
 39,142,112 
 
 1898 
 
 40,630,970 
 
 1899 
 
 42,241,308 
 
 1900 
 
 43,231,109 
 
 1901 
 
 46,055,087 
 
 1902 
 
 48,040,344 
 
 1903 
 
 . 52,782,201 
 
 Now the same thing is 
 
 shown, if you take up St. Croix 
 
 and Clark counties. You 
 
 see, as you would expect to see, 
 
 the aggregate value of the lands of the county keeping 
 pretty close step with the progress of the advance in market 
 
 price per acre of the land. 
 
 But that is not all. 
 
 If the yearly realty values of these several counties are ap- 
 
136 
 
 proximately correct, as computed by us, we ought to find that 
 the yearly values for what may he termed the center years 
 of the seven and five year periods (being 1898 and 1900, 
 respectively) are somewhat, but not greatly less than the 
 average values for the respective periods, inasmuch as the 
 price per acre for lands sold increased more during the latter 
 half than during the first half of the respective periods. 
 The table following shows how well the yearly values of 
 1898 and 1900 stand this test: 
 
 Average Yearly 
 
 Value. Value. 
 
 Seven years’ period — 
 
 Dane County $57,266,795 $57,095,451 (1898) 
 
 Dodge County 41,615,979 40,630,970 (1898) 
 
 Five years’ period — 
 
 Dane County 60,725,027 58,659,456 (1900) 
 
 Dodge County 43,337,744 43,231,109 (1900) 
 
 St. Croix County 11,130,263 10,926,355 (1900) 
 
 Clark County 11,786,730 10,015,618 (1900) 
 
 Yow, this is a hard matter to present in a very enticing 
 form, but I trust I make myself plain to the Board as I 
 go along. If I do not, I wish you would interrupt me. I 
 take it that all the members of the Board are entirely 
 familiar with the arithmetical processes which have been 
 used in arriving at the different results, and therefore un- 
 derstand the system of cross-checking I have attempted to in- 
 troduce here. 
 
 The further fact that the yearly realty values of a given 
 county for the several years of the five year period, added 
 together, and the sum divided by five, gives an average 
 value for the period closely approximating the average value 
 arrived at by following the Board’s method of computation, 
 
137 
 
 is additional confirmation of the position that the yearly 
 realty values thus added together are severally substantially 
 correct. That is what 1 am trying to prove, that the last one 
 is correct, too. Have I made myself plain on that proposi- 
 tion ? When you tried to arrive at the value of the Town of 
 Albion in Dane County for your five years’ period you did 
 not compute what it was worth on the basis of each twelve 
 months’ period, and then add those yearly values together 
 and divide the aggregate by five, but you threw into one con- 
 tinuous computation all the acres transferred during the en- 
 tire five years’ period in that township and divided the gross 
 consideration into the gross assessment to reach your ratio, 
 and then applied that ratio to the average assessment dur- 
 ing the five years, of all the realty. 
 
 Mr. Curtis : Seeking to avoid averaging averages. 
 
 Mr. Polleys : Yes ; and because averaging averages in 
 
 the tests I have made brings you back to substantially the 
 same average result is to my mind further proof that the in- 
 dividual sums thus thrown together and added, and di- 
 vided by five, must each of necessity closely approximate the 
 truth, assuming your average result to represent the true 
 average value. 
 
 The following table shows the very close agreement be- 
 tween the average realty value of the four counties named, 
 as computed in accordance with the Board’s plan, and as 
 computed by adding together the five separate yearly values 
 for each county and dividing their sum by five, — the average 
 of averages method: 
 
138 
 
 board’s method. average of 
 
 AVERAGES METHOD 
 
 Dodge County $ 43,337,744 $ 44,039,764 
 
 Dane County 60,725,027 61,947,900 
 
 St. Croix County 11,130,263 11,188,566 
 
 Clark County 11,786,730 11,288,473 
 
 Four counties combined. . . .$126,979,764 $128,464,703 
 
 Mr. Polleys: The foregoing figures clearly show that the 
 
 larger the district covered by the computation is made, the 
 more closely does the average value for the five year period 
 arrived at by adding together the five yearly values, and di- 
 viding the sum by five approximate to the average result 
 arrived at by following the method prescribed by the Board, 
 and thus tends to show that as the districts computed grow 
 larger, the more nearly do the yearly values for such dis- 
 tricts approach the truth, assuming the truth to be the aver- 
 age value that the Board has figured out. 
 
 Mr. Curtis: Isn’t it always true that in dealing with 
 
 averages the larger the amount of data you take the less 
 erratic the results you get from any incorrect data used as 
 one of the factors? 
 
 Mr. Polleys: Of course, that is the simple proposition 
 
 I am working on right along. 
 
 Te recapitulate the four facts I wished to call your atten- 
 tion to, as seeming, to my mind, to be of great force in 
 proving that the yearly values I got for the different counties 
 are substantially correct, if you assume that your average 
 values for the 5 years’ period are correct: (1) It is a 
 
 fact that the value at the end of the period must be a good 
 deal more than your average value, because the prices have 
 risen; (2) the yearly values progress substantially in con- 
 
139 
 
 formity with the rise of prices; (3) the yearly values for the 
 center years of the period coincide remarkably with the 
 average values of your period; and (4) you get an average 
 value of the period by adding together my yearly values and 
 dividing by 5, which approximates exceedingly closely the 
 average valuation which you get in the other way. 
 
 Now, of course, I didn’t have time to do the 70 counties 
 of the state in the manner prescribed by the Board; and so 
 it was necessary if I made any computation of the state as 
 an entirety, to adopt a shorter cut than I had yet found. 
 So I resorted to what I will allude to, and will now explain, 
 as the “county recapitulation plan.” Of course, you remem- 
 ber the little tables that are attached by the register of 
 deeds, to the land sales reports as they come in 
 from year to year. He puts down the number 
 of acres that are sold as covered by that report in 
 the 12 months period ending September 1st for the given 
 year; and the total consideration for which they are sold, 
 and the total amount for which those acres are assessed. Then 
 he gives the lots in the same manner. Assuming he has per- 
 formed his arithmetic correctly — which is a violent assump- 
 tion — you have the basis for two examples in ratio. I did 
 not verify those figures. I took the whole county in that 
 way and performed 140 examples of ratio — or 142, if there 
 are 71 counties. 
 
 Mr. Curtis : You took his data for those arithmetical 
 
 calculations, and calculated them over for him ? 
 
 Mr. Polleys : He hadn’t figured out these particular things. 
 I didn’t check him on a single thing. 
 
 Mr. Haugen : Most of the registers figures had the value 
 per acre, or lot. 
 
140 
 
 Mr. Policy s : Yes ; but not the ratio between the asess- 
 
 ment and the consideration. I simply took those 71 re- 
 capitulations, as I found them attached to the 1903 land 
 sales reports and figured out the ratio in each county for the 
 lands, and the ratio for the lots. Of course it goes without 
 saying that there is a large additional element of error in 
 the thing, as I did it; but, for the reason that the large ad- 
 ditional element of error is there, and that it cancels all out 
 again, I lay a good deal of stress on the idea that these 
 errors that come in merely from the application of your 
 formula, are largely self-compensating when applied to a 
 large district like the state. I am not speaking of the effect 
 in the body of statistics of the large number of things that 
 should not be there. 
 
 Now just briefly, I will finish this up. You all know 
 the work I must have gone through to arrive at the value 
 of Dane County on your plan for the year ending Septem- 
 ber 1, 1895 ; and so with each other year throughout the 
 period ending September 1, 1903. But it was not much 
 work, comparatively, to compute the entire state on the 
 county recapitulation plan. 
 
 The following table shows the yearly realty values of the 
 four counties specially investigated, (1) as computed in 
 accordance with the method of the Board and (2) as com- 
 puted by the county recapitulation method: 
 
141 
 
 
 Board’s 
 
 Method. 
 
 County 
 
 Recapitulation 
 
 Method. 
 
 Dane County: 
 
 1895 
 
 $ 51,536,743 
 
 $ 50,462,006 
 
 1896 
 
 53,979,644 
 
 55,090,348 
 
 1897 
 
 53,065,969 
 
 52,188,081 
 
 1898 
 
 57,095,451 
 
 55,264,820 
 
 1899 
 
 55,316,097 
 
 54,843,927 
 
 1900 
 
 58,659,456 
 
 58,418,735 
 
 1901 
 
 67,664,496 
 
 65,426,733 
 
 1902 
 
 71,003,999 
 
 69,871,534 
 
 1903 
 
 76,672,541 
 
 75,946,349 
 
 Total 
 
 544,994,396 
 
 537,512,533 
 
 Dodge County: 
 
 1895 
 
 40,311,197 
 
 40,270,870 
 
 1896 
 
 41,272,543 
 
 39,984,260 
 
 1897 
 
 39,142,112 
 
 38,599,236 
 
 1898 
 
 40,630,970 
 
 41,084,469 
 
 1899 
 
 42,241,308 
 
 41,525,242 
 
 1900 
 
 43,231,109 
 
 40,156,678 
 
 1901 
 
 46,055,087 
 
 46,005,150 
 
 1902 
 
 48,040,344 
 
 46,155,390 
 
 1903 
 
 52,782,201 
 
 53,027,776 
 
 Total 
 
 393,706,871 
 
 386,809,071 
 
 Clark County: 
 
 1898 
 
 7,898,479 
 
 7,904,696 
 
 1899 
 
 8,093,575 
 
 8,101,784 
 
 1900 
 
 10,015,618 
 
 8,048,678 
 
 1901 
 
 13,772,392 
 
 12,150,221 
 
 1902 
 
 16,662,300 
 
 16,311,281 
 
 1903 
 
 18,931,820 
 
 18,567,607 
 
 Total 
 
 75,374,184 
 
 71,084,267 
 
142 
 
 St Croix County: 
 
 1898 9,881,951 9,776,608 
 
 1899 9,430,792 11,050,798 
 
 1900 10,926,355 10,918,090 
 
 1901 11,307,908 11,345,566 
 
 1902.. 14,395,825 13,990,826 
 
 1903 16,458,508 16,757,297 
 
 Total 72,401,339 73,839,185 
 
 Four counties combined ..$1,086,476,790 $1,069,245,056 
 
 Upon tbe strength of the results shown by the foregoing 
 table, I thought I would be justified in going on and figuring 
 the seventy counties upon the recapitulation basis for the 
 twelve months’ period, expiring September 1, 1903, as a 
 means of arriving at the realty value of the State of Wis- 
 consin in 1903. I did that, and excluding Wilwaukee 
 County, which we have treated separately, by itself — as 
 the Board, has done before us — I found, as was stated by 
 Mr. Dudley this morning, that the realty value of the re- 
 mainder of the State of Wisconsin was substantially 
 $1,312,000,000; to which must be added the realty 
 value of Milwaukee County, which is put by Mr. Dudley and 
 the other gentlemen at $346,000,000, making a total realty 
 value for the entire state of $1,658,000,000, which under any 
 circumstances, and in any event, it seems to me is the very 
 lowest that it could possibly be put, and ought to be put. 
 
 Mr. Dudley: You are using the 1902 assessment roll. 
 
 Mr. Polleys: Yes; because that was necessary, in order 
 
 to comply with the method of the Board. 
 
 Chairman Gilson: By your computation in 1903, what 
 
 was the value of Milwaukee County ? 
 
143 
 
 Mr. Polleys: $252,000,000; and I checked that up for 
 
 the five years’ average, using the county recapitulation plan ; 
 and that is about what it has been for some years ; and the 
 Board has been constantly finding Milwaukee County realty 
 worth a good many millions more than that for several years ; 
 has been finding its value about- two hundred and ninety mill- 
 ions for the past three years. Of course I do not know how 
 great the elimination may have been carried on in Milwau- 
 kee County by the Board. Unless there was very great 
 elimination carried on I do not see how we could arrive at 
 the Milwaukee result, as found by the Board for the past 
 three years. 
 
 Mr. Crandon : Sixteen hundred and fifty eight millions ? 
 
 Mr. Polleys: Yes. 
 
 Mr. Crandon: Ours was about 1,800,000,000. 
 
 Chairman Gilson : Still, you confirm Mr. Dudley’s esti- 
 
 mate ? 
 
 Mr. Polleys: It seems to me it is decidedly a confirma- 
 
 tion of his estimate, for there are a great many things in the 
 statistics used by me which do not belong there, and my re- 
 sult is necessarily too low. 
 
 Chairman Gilson: You took the registers figures for each 
 county for 1903, ending September 1st? 
 
 Mr. Polleys: Yes. 
 
 Chairman Gilson: You took the assessment of 1902? 
 
 Mr. Polleys: Yes. 
 
 Chairman Gilson: For each county? 
 
 Mr. Polleys: Yes. I do not take the assessment of 1903. 
 I followed the Board’s method, I think, in all respects. 
 
 Mr. Dudley: At the time Mr. Polleys made the figures 
 
 the 1903 assessment roll was not available. 
 
144 
 
 Mr. Haugen: Mr. Dudley, if this preliminary hearing 
 
 was held at the time required by law, between the 1st and 
 15th of September, it would he impossible to use the figures 
 of 1903. You have to use the figures of the preceding year. 
 
 Chairman Gilson : Why do you use the assessment of 1903, 
 instead of 1902. 
 
 Mr. Dudley: We considered that we had to do merely 
 
 with the 1903 values of general property; and the assess- 
 ment roll of 1903, was the only property we had to do with — 
 the property on that roll. We were trying to get the true 
 value of that property. We had the American Appraisal 
 Company appraise the property as of May 1, 1903, com- 
 paring with the identical descriptions of 1903 ; and applied 
 that also to the 1903 roll. All our figures are based on the 
 value of property as we supposed it to be in 1903 ; and the 
 assessment roll of 1903, we have used as a basis. 
 
 Mr. Haugen : If they w T ere held at the time the law con- 
 
 templates, the assessment roll would not he available, and 
 sales would not be available. 
 
 Mr. Dudley: The law does not require you to follow this 
 
 method, this register of deeds method. If it does not arrive 
 at the proper result, it ought to he discarded. 
 
 Mr. Hausen: We have considered it the best available. 
 
 Mr. Dudley: You have heretofore; hut in future we hope 
 you wfill not. 
 
 Mr. Crandon: We are about to leave, some of us, soon, 
 
 and there were one or two inquiries we wanted to make. 
 First, I want to state, that we are in shape to prosecute the 
 inquiries that we have been prosecuting, if the doing of it 
 will be of value, and we can get the results before you in time 
 to be of service for this year. 
 
145 
 
 Mr. Baldwin : You mean in other counties. 
 
 Mr. Crandon: In other counties, yes. I would like to 
 
 know what the Board of Assessments think in regard to that; 
 first, whether they care for further investigation along the 
 lines that have been indicated, that up to what time they 
 would think that they coud avail themselves of the results 
 of such inquiry. 
 
 Mr. Dudley: I think perhaps we might as well state 
 
 specifically what we can do. About all the investigation that 
 could he done now would he in the nature of making tran- 
 scripts of deeds reported to the registers of deeds, and read- 
 ing those deeds and seeing whether they ought to have been 
 reported or not. 
 
 Mr. Curtis: Completing the w 7 ork in Ozaukee 'and Racine 
 
 counties ? 
 
 Mr. Dudley: No; not completing that; I thought per- 
 
 haps it would be best to take up other counties and make a 
 transcript of the deeds returned by the registers of deeds, and 
 read the deed itself, as was done in Ozaukee and Racine. In 
 Milwaukee County we went beyond that. After eliminat- 
 ing those transfers which on the face of the deed should not 
 have been returned, then further inquiry was made of the 
 parties to the transaction. Row w T hat I would suggest 
 would be that we continue the work, so far as it can be con- 
 tinued at the county seats merely. It would be difficult to 
 run all over the county and find parties to the transaction 
 and make inquiries. 
 
 Mr. Curtis: How many counties could you cover in that 
 
 way in the next thirty days ? 
 
 Mr. Dudley : I don’t know 7 . 
 
 Mr. Crandon : In the w^ay Mr. Dudley suggests ? 
 
146 
 
 Mr. Curtis: Yes, in the way now indicated. 
 
 Mr. Crandon : Mr. Brown said, in an offhand way, that 
 
 he thought with such assistance as he could command, he 
 could do practically four counties a week. That would he 
 from sixteen to twenty counties in the thirty days. 
 
 Chairman Gilson: I think, Mr. Crandon, that the. Board 
 
 had better take that matter under advisement for perhaps 
 two or three days, and determine whether or not we would 
 suggest any further investigation. You are aware, of course, 
 you are very sensible of the fact, that the time in which we 
 are to make a preliminary valuation and final valuation of 
 the general property of the state, and of the railroads, is not 
 very long. 
 
 Mr. Crandon : We understand that. We only want to 
 
 accommodate ourselves to your convenience, and perform 
 any service in our power. Will you write me then ? 
 
 Chairman Gilson : Of course you cannot cover the en- 
 
 tire state, and the most you can do would be to take up a 
 few counties and perhaps present those as arguments for mak- 
 ing the value of the real estate throughout the entire state. 
 
 Mr. Polleys : Wouldn’t it be well, in case the Commission 
 desires to call for this further work, for them to select a list 
 of counties that they think would be most representative ? 
 
 Mr. Curtis : The Commission would be, perhaps, glad 
 
 to avail themselves of that suggestion, if we feel that we 
 will have time to consider further data in that way. 
 
 Chairman Gilson : We would be very glad to have you 
 
 continue the investigation if it could be presented to us, and 
 we verify it, if we thought fit, within the period before the 
 valuation. 
 
 Mr. Crandon : Will you write me what you think of it ? 
 
147 
 
 Mr. C ran don : As a final word for to-day, so far as I am con- 
 cerned, I want to call to the attention of the Board what they 
 know very well, and perhaps are thinking about a great deal 
 oftener than I am. Still it is a matter which I think it very 
 well worth our while to keep always in mind: There are 
 
 some statutory, provisions that have been referred to here 
 to-day — I do not mean by the Board, but by ourselves — which 
 would seem to indicate that the line of investigation of the 
 general property of the state is necessarily and specifically 
 limited to the property which is on the tax roll. In a case 
 that was carried to the United States Court of Appeals in 
 Tennessee, the question of a statutory regulation which pre- 
 vented the consideration of a full examination of the mat- 
 ter of values — a question which was not identical with but 
 was similar to the one with which we have to deal — was dis- 
 posed of bv the court in this way: 
 
 “The constitutional right of every tax payer to pay his 
 taxes at the same rate with every other tax payer, overrides 
 any statutory provision, and the courts will find some way 
 of giving effect to that principle.” 
 
 If then, it should appear that in the State of Wisconsin 
 there are bodies of property that are not on the tax roll, and 
 are therefore not being considered, but which, if they were 
 on the tax roll, would limit the rate of taxation which you 
 will finally apply to whatever assessment of railroad prop- 
 erty you shall think is fair, would not the application of the 
 doctrine announced call at least for a consideration of prop- 
 erty that ought to be assessed, but is not assessed ? If it is 
 the constitutional right of every taxpayer to be put on an 
 equality with his neighbor, and if that constitutional right 
 as was said by that court, overrides any statutory enact- 
 ment, then if Mr. Baldwin’s exposition of the grossly in- 
 adequate assessment which has been placed upon the per- 
 
148 
 
 sonal property of the state, and his claim that it ought to be 
 greatly enehanced is true, and if our claim that the real es- 
 tate ought to be assessed at a much higher rate than had been 
 placed upon it, is correct, and that unless such advances in 
 the assessment of both the real and personal property are 
 made, the rate of taxation to he put upon railroad property 
 will be unequal to the rates of taxation paid by other tax- 
 payers in the state, and if the blind following of some pro- 
 vision of the statute, would result in producing such an in- 
 equality, would not the Board of Assessment be justified 
 in considering that fact, and giving effect to the principle 
 announced by the United States Court in its final determi- 
 nation of the rates of taxation to be paid upon railroad prop- 
 erty after the assessment is made? I do not now ask an 
 answer to the question. I state the proposition and I think 
 that I have properly indicated the law. I know that equity 
 would demand the action which I suggest, and I hope that 
 the matter will not escape the consideration of the gentle- 
 men who, I am sure, desire to treat fairly every proposition 
 that is before them. 
 
 Chairman Gilson : What case is that ? Do you remember 
 the title of it? 
 
 Mr. Crandon : The Louisville & Nashville Railroad 
 
 against the State of Tennessee. 
 
 Professor Taylor: In the 89 Fed. Reporter — or the 88th. 
 
 Chairman Gilson: It was first decided by Judge Clark 
 
 at Nashville; and afterwards by the Court of Appeals at 
 Cincinnati. 
 
 Is there any other gentlemen here that wishes to be heard ? 
 
 Hearing adjourned.